Congressional Record, Volume 140 Issue 35 (Thursday, March 24, 1994)

[Congressional Record Volume 140, Number 35 (Thursday, March 24, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]

[Congressional Record: March 24, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

CONGRESSIONAL BUDGET CONCURRENT RESOLUTION

The Senate continued with the consideration of the concurrent
resolution.
The PRESIDING OFFICER. Who yields time?
Mrs. HUTCHISON. Mr. President, I would like to just close by
discussing a few of the items that the distinguished Senator from
Nevada brought up.
First of all, when a mayor is facing a cut in a city budget, the
mayor does not come in and cut the police department. The mayor looks
for the nonessential spending items. In fact, many mayors in this
country would be happy to have only a 7.5-percent cut in their budgets.
So the answer is not to talk about shutting down the Library of
Congress or the Capitol Police or casework.
I have cut 20 percent from my own office budget voluntarily because I
thought that was the right thing to do. We answer the mail. We do
casework. We are very attentive to our State.
I think the people of Texas are well served because they know that I
am doing what every one of them has had to do at some point in their
business or in their households, and that is cut their budget 5, 10,
15, or 20 percent. But we are only asking today for a 7.5-percent cut
in the offices of Congressmen and Senators, and the money it takes to
run the Capitol and pass the laws for our land.
A number of businesses are living with a lot of the mandates and laws
that Congress has passed. So, when the Senator from Nevada talks about
Congress having more expenses because we have to live within our
legislative mandates, the businesses of this country know what he is
talking about. But they do not have the ability to just increase their
budgets, they have to pay for those mandates by cutting in other areas.
And that is what we in Congress must do. We must prioritize our
spending.
Our amendment does not eliminate anything. It does not eliminate the
General Accounting Office or the Office of Technology Assessment. It is
an overall cap on spending. It cuts $200 million for fiscal year 1995,
and more thereafter. The total cut from the baseline is $2.4 billion
over 5 years.
I think if the American people have a choice of whether to keep their
tax dollars or whether we mortgage the future of our children and
grandchildren--we have some of these committees that we could cut back
or franked newsletters that maybe they do not need--they are going to
choose to keep the money that they work so hard to earn. They may want
to take the kids on a vacation or buy them shoes, or whatever the
family decides to do with their money.
Last night I was very impressed with Senator Ford. Senator Ford is
the head of the Administration Committee, and he was looking at the
costs that our being in session at 3:30 this morning was costing the
taxpayers of America. He was trying to cut the printing costs from our
Congressional Record, and he was looking at the light costs and the
staff costs. I admire him, and I think he is right to do that, and I am
glad that the people of America know that Senator Ford is looking out
for their taxpayer dollars.
Most businesses in America have had to cut 7.5 percent from their
budgets at some point. Most homes in America have had to do the same
thing. I think it is time for Congress to show leadership, to show we
are serious about budget cuts and say that we can do the same.
Thank you, Mr. President.
I ask for the yeas and nays, and I yield the remainder of my time.
The PRESIDING OFFICER. Is there a sufficient second?
Mr. REID. Mr. President, a parliamentary inquiry.
The PRESIDING OFFICER. The Senator will state it.
Mr. REID. What is the matter before the body?
The PRESIDING OFFICER. The matter is the Hutchison amendment No.
1532, and the Senator has asked for the yeas and nays.
Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, I would just briefly respond.
The assumptions that we received from the Senator's office that was
passed out with this amendment on March 22, 1994, at 11:35 a.m.
indicate that there would be these significant cuts. I did not make
these up. This is information we got from her office. These are
assumptions she made.
Mrs. HUTCHISON. Mr. President, will the Senator yield?
Mr. REID. Mr. President, let us take the General Accounting Office.
If we do follow the assumptions of the Senator from Texas that we do a
25-percent cut in addition to the 600 people we already cut from GAO,
how much Government waste, fraud, and abuse will occur as a result of
the General Accounting Office, our watchdog being unable to discover
fraud, waste, and abuse within the Federal Government on all levels of
Government?
I am working with one of my colleagues to take a look at the Federal
Reserve Board. The General Accounting Office is the only body equipped
to do that. It is very difficult, very time consuming, and my colleague
and I have a tremendous interest in this.
If there is a 25-percent cut of the staff of GAO, that will never
happen.
What about the problems we have in the military of excessive
contracting? We know the money that has been saved and people have gone
to jail as a result of the work of the General Accounting Office.
Mr. President, I would also talk about franked newsletters. In the
U.S. Senate there are no franked newsletters. We do not have the money.
In the U.S. Senate each Senator does not have enough money to mail one
letter to each of his or her constituents.
So I say how in the world could we send newsletters? We cannot. There
is not enough money.
Mrs. HUTCHISON. Mr. President, will the Senator yield?
Mr. REID. I am happy to yield on the time of the Senator from Texas.
The PRESIDING OFFICER. The Senator from Texas.
Mrs. HUTCHISON. Mr. President, I just want the Senator from Nevada to
understand that the Senate minority Budget Committee prepared a draft
of possible ways that the cuts could be made. These are not my
priorities, and I did not distribute this. I would not make some of
these cuts. I would have a different list of priorities. This amendment
is an overall budget cut of the general Government function, and that
is all.
So it is a mistake, and I am sure it is just a misunderstanding to
say that it is part of this amendment to make the cuts that the Senator
is suggesting.
Mr. REID. Mr. President, I would respond to my friend from Texas that
all I am doing is reading a document that says Senator Hutchison is
reducing funding from the legislative branch that was passed out
Tuesday. That is where the document was obtained.
It is easy to say, ``I make other cuts.'' The fact of the matter this
is the guide.
I yield to the Senator from North Dakota.
Mr. DORGAN. Mr. President, I appreciate the Senator yielding to me.
I was not here for all of the presentation by the Senator from Texas
[Mrs. Hutchison]. However, I heard enough to know that she just showed
up in Congress a little late with respect to cutting franking. The
Senator from Nevada [Mr. Reid], has been cutting and cutting and
cutting our franking, or mailing, budgets in recent years.
The franking budgets in both the House and the Senate used to be far
more substantial than they are now. We have cut our franking spending
radically.
Second, let me respond to the possibility of cuts to the General
Accounting Office. I think it would not be a thoughtful exercise to
suggest that we cut 25 percent more from the General Accounting Office,
in addition to what we have already cut. The GAO is crucial to the
ability of Congress to ferret out Government waste.
Let me give you one example. Do you know that the Defense Department
decided to buy some ant bait? That is right, ant bait to kill ants--
they wanted to buy 27,000 dollars' worth of ant bait. Do you know how
long it took them to buy ant bait? It took 29 pages of procurement
regulations and 270 days to buy 27,000 dollars' worth of ant bait.
Who helps us discover that sort of absurdity, that kind of grotesque
waste, that bizarre purchasing behavior? The GAO. The General
Accounting Office is worth billions and billions of dollars in savings
to American taxpayers.
So I would only say that if we believe that we are serving the
taxpayers' interest by cutting 25 percent from the General Accounting
Office, in addition to the personnel cuts the GAO has already suffered,
we are not saving anybody anything. We are costing the American
taxpayers billions and billions of dollars more by not being able to
discover that trying to buy ant bait ties us up in knots. We are buying
cream-filled cookies with 16 pages of regulations. We need the General
Accounting Office to help us discover what is going on in the executive
branch when it spends $1.5 trillion.
I want to emphasize this point. There have been sustained budget cuts
in congressional spending under the leadership of the Senator from
Nevada.
With respect to franking, Senator Reid has successfully led the fight
to substantially reduce the franking budget.
It is easy to talk about cutting these things, but the proof is what
has been done here in the Senate. And I just rise to compliment the
Senator from Nevada on his real budget cuts, which have made a
difference in the legislative branch appropriations.
Mr. REID. Mr. President, I appreciate very much the Senator from
North Dakota, who is also one of the leaders in the Congress for fiscal
constraint and saving money. No one that I know of has done a better
job of articulating the need for this country to cut its spending than
the Senator from North Dakota.
Mrs. HUTCHISON. If the Senator will yield, I would just like to set
the record straight, Mr. President.
My office did not distribute the allocations that both Senators have
mentioned. There are suggestions that were made by the Senate Minority
Budget Committee as to some of the ways that the cuts could be made. I
do not know if these are the committee's priorities. And I am sure that
the Senator from Nevada, who has a record, I am told, of fiscal
responsibility, would set the priorities and that the priorities would
be correct. But again, these are not my priorities at all. This is a
cut in the General Government function.
Thank you, Mr. President.
The PRESIDING OFFICER. Who yields time?
Mr. REID. The Senator and I would yield back our time; is that right?
Mrs. HUTCHISON. I yield back the remainder of my time.
Mr. HATFIELD. Mr. President, I would like a few minutes before the
time is yielded back, if I could.
Mrs. HUTCHISON. I am happy to yield from our side to the Senator from
Oregon.
The PRESIDING OFFICER. Does the Senator from Texas yield time to the
Senator from Oregon, [Mr. Hatfield]?
Mr. REID. Mr. President, I apologize. I did not see the senior member
of the minority of the Appropriations Committee here or I certainly
would not have called for yielding back the time.
The PRESIDING OFFICER. Who yields time?
Mr. HATFIELD addressed the Chair.
The PRESIDING OFFICER. The Senator from Oregon is recognized, Mr.
Hatfield.
Mr. HATFIELD. Could I have about 6 or 7 minutes?
Mr. REID. How much time do I have remaining?
The PRESIDING OFFICER. The Senator from Nevada has 13 minutes.
Mr. REID. The Senator from Oregon can consume whatever time up to 13
minutes that he desires.
Mrs. HUTCHISON. I would like to reserve the right to close after the
Senator from Oregon [Mr. Hatfield] has finished his remarks.
The PRESIDING OFFICER. At this time, the Senator from Texas has 30
minutes under her control and the Senator from Oregon is yielded the
remainder of the time under the control of Senator Reid.
Mr. DORGAN. I ask unanimous consent, if the Senator from Oregon does
not consume the entire amount, that I might be allowed to use part of
the remaining time of the Senator from Nevada.
Mr. REID. I have no objection.
The PRESIDING OFFICER. The Senator from Oregon is recognized.
Mr. HATFIELD. Mr. President, we get into these exercises of
contesting who can cut most--who can cut here, who can cut there--and
we think we are going to get a lot of political brownie points from the
public or the constituents out of this great budget-slashing activity.
Well, I think there is always a threshold between responsible
budgeting and irresponsible budgeting. I think this amendment is
irresponsible. And I say that because the chairman of our subcommittee,
the Senator from Nevada, has already demonstrated the overall picture
of what has been happening in the past 3 or 4 years of reducing the
legislative branch expenditures. Let me say, Mr. President, there is no
other subcommittee that can take the kind of pride in true responsible
budget cutting than the legislative subcommittee.
Now we reach a threshold of whether we are responsible or
irresponsible. I want to say that there is not a Senator here on this
floor that cannot move ahead unilaterally and do all the budget cutting
they want in this legislative branch by cutting their own offices. No
one is precluded from cutting their office. If they think they can
operate on this kind of reduction at their offices, go ahead and cut
it.
There are a number of Senators who have turned back unexpended,
unobligated funds from their personal office budget. Nobody is being
forced to spend this money under this legislative branch appropriation
bill that relates to their own office.
If one is on a committee and they can move and get the support of the
committee to cut the budget, cut the committee budget. There is no one
preventing them from doing that.
This big display about a big amendment on the floor that is going to
balance the budget or lead us to that wonderful rosy tomorrow when the
budget is balanced by taking these unnecessary, irresponsible slashes
at the legislative branch is not really, in my view, seeking to do the
best for the Congress or for the budget process.
Let me take one example: The Library of Congress.
Mr. President, in the old days, when invading armies hit a city or a
country, instead of going to the television stations to capture the
television stations, which they did not have in those ancient days,
they went to the library. That is where they went. The invading armies
went to the libraries, the source of information and knowledge, and
they took control of the libraries.
Well, those libraries are as vital and important to civilization
today as they were in those ancient times.
Let me just read from the record. We have already reduced the Library
of Congress by $142.537 million and 854 personnel.
I would like to know how much advantage the Members of this Senate
that are promoting this particular budget cut, how much advantage they
have taken of the CRS, the Congressional Research Service of the
Library of Congress? If they are really sincere about wanting to move
this budget down on the Library of Congress, let us see us take the
initiative by reducing our demands on the Library of Congress.
Now, we might say, well, that may not be a category included in the
amendment. But, Mr. President, let us be honest about this. If you have
this kind of reduction from the legislative branch, the Library of
Congress is going to have to take a further reduction.
You can tell the public's reaction when we had to restrict the hours
of the Library of Congress. It is the old story: ``Don't cut the things
that I am interested in.'' Cutting the hours of the Library was very
highly resented, but they had to be cut because of the budgetary
reductions our committee has imposed upon the Library.
Mr. President, we are in arrearages of that Library of catching up
the titles, the thousands of titles that are put into that Library
every year. We have been moving very carefully on bringing up that
backlog over a period of time. This will further, then, push us back in
time of those arrearages.
Now those arrearages are not just a matter of making it more
convenient to have access to the Library for people here in Washington.
Every library in the country depends on the currency and access to the
information of the Library of Congress. Starting with Dan Boorstin and
others following him, they have moved this Library of Congress out of
Washington, DC, in terms of the access of local communities and States
across this country, accessing that great treasure of information and
knowledge, the greatest in the world.
If you look at the program we have had on preservation, we are losing
books year after year all across this country because of the acid ink
used on the paper. They have been disintegrating at an ever-increasing
rate. We have been trying a very carefully designed program of
preservation. It is not just in the books; it is in the film, it is in
the photographs, it is in the records. It is in all the multiple means
of preserving history we have in our Library. We cannot afford to let
that get ahead of us as we have in the past. We are trying to catch up
as it is.
Mr. President, I hope this amendment is rejected at this time,
knowing the committee has done its work and is continuing to do its
work in reducing the legislative branch expenditures. They are doing it
on a careful basis, not on some amendment that has been put together by
a couple of staff people maybe within the last half-hour or day or two,
and thrown up here on the floor where there has been no analysis.
I would like to take the Senator into a colloquy, to go into the
dollar-by-dollar analysis of this proposed cut--I will restrain my
desire to do so--because I have the records here, where we have moved
on those cuts. I know of their careful consideration, through hearings
and testimony, that has not been accessed here on the floor--at least
not to my knowledge. I have not seen any such Senators around our
committee process. Yet all of a sudden we come up here with a great
amendment that is going to save money for the legislative branch.
My simple description of this amendment comes back to the word
``irresponsible.''
The PRESIDING OFFICER (Mrs. Boxer). The Senator from North Dakota has
4 minutes 56 seconds remaining. The Senator from Texas has 30 minutes
remaining.
Mr. REID. I yield 4 minutes to the Senator from North Dakota.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. DORGAN. Let me follow the remarks of the Senator from Oregon by
saying that I have spent a lot of time on the issue of Government
waste. In this body and also over in the House of Representatives I
have voted continually to cut and cut and cut. I will continue to do
that. The recent rating that came out rating Members' proclivity to
favor cuts shows I rank number five on this side of the aisle in the
U.S. Senate, in voting to cut spending.
I have spent about 2 years working on a waste project, identifying
$83 billion in waste that we can target to reduce Federal spending. So
I do not take a back seat to anybody on the question of whether we
should cut spending. Of course we should. We ought to continue spending
on things that work and cut spending on things that waste.
My concern is, it is all too easy not only to join but also in some
cases lead, those who want to create an impression that the Congress is
a real cesspool of excess.
There are plenty of blemishes, plenty of problems, plenty of things
wrong with Congress. But we actually have fewer people working in the
legislative branch today than we did in 1980. That is just a fact--
fewer people working in the legislative branch of Government today than
we did in 1980. We have cut.
I mentioned the franking. The Senator from Nevada has led the effort
on franking. I was surprised when I came to the Senate to see what had
happened to the franking budget. It is substantially below what it was.
It was cut substantially time after time.
I mentioned previously, when I spoke about the value of the General
Accounting Office, that we spend $1.5 trillion in the Federal
Government. The GAO is our watchdog. How many in this room know that in
the inventory down in the Department of Defense are 1.2 million bottles
of nasal spray? There are 1.2 million bottles of nasal spray in
inventory at DOD. Do you know how many years of runny noses it would
take to consume 1.2 million bottles of nasal spray?
How do we know they wasted money in inventory mismanagement that way?
The GAO. The GAO helps us find out how do you spend the taxpayers'
money. We appropriate the $1.5 trillion money and then someone else
spends it. I do not disrespect anybody's motives. I think everybody has
a right to offer amendments on anything. But I urge that we not try to
beat up on the institution of the Congress. We need the resources
necessary to do our job. We have brought to this floor, from a
subcommittee under the leadership of the Senator from Nevada, proposals
that cut spending in real terms. These are proposals that are
thoughtful, that move in the right direction, and cause us to tighten
our belts when we ask others to tighten their belts. That is a fact.
But what we ought to do is make sure we also fund our obligations,
make sure the $1.5 trillion we spend of the taxpayers' money is spent
wisely. That is embodied also in a significant part of the legislative
branch funding.
I am going to vote against this amendment. This amendment has nothing
to do with Government waste. I vote against Government waste and will
vote to cut the legislative branch. But I will not vote for an
amendment that seems to imply the major problem in Federal spending is
in the legislative branch. The fact is--let me repeat it--there are
fewer people working for the legislative branch today than there were
14 years ago. Why? Because we have had substantial cuts in the
legislative branch. The Senator from Nevada has led us in this effort.
And I am proud of that. I will continue to participate in that. But
this is an amendment that, in my judgment, is not worthy of our
support.
I yield the floor.
The PRESIDING OFFICER. Who yields time? The Senator from Texas.
Mrs. HUTCHISON. Madam President, I would like to close on this
amendment. All of the problems of the Federal Government are not
embodied right here in the legislative branch, but if we are going to
ask the people of America to accept higher taxes or fewer services, and
if we are going to ask the people who work in our Federal agencies and
Departments to cut back and to watch expenditures, I think Congress
should lead the way. We are talking about a $200 million cut from a
$2.3 billion budget. We have not cut the budget of the legislative
branch from the $2.3 billion level for the last 3 years. It has been
relatively the same. In fact, I do not know how many people were
working here in 1980, but in 1983 the budget was $1.3 billion. In 1993,
it was $2.3 billion. That is not a decrease; it is a 95 percent
increase in the budget.
The arguments we hear are like the Washington Monument syndrome. It
goes like this: ``If you cut the Federal budget, we are going to have
to shut down the Washington Monument.'' Opponents always pick the most
visible expenditure to fight losing their debate.
I think maybe we should cut nasal spray from the Department of
Defense, Senator Dorgan. It looks like maybe we found a budget cut. I
appreciate that being brought forward. We should make every cut in
unnecessary spending we can to balance the budget.
It is very important that we take the lead and show that we can do
what most businesses in this country and most households in this
country have been able to do. That is, cut 7.5 percent of discretionary
spending by prioritizing and making sure we fund what we need to fund,
but returning to the taxpayers of America $2.4 billion over the next 5
years. I really think it is a small step for us, and a very important
one, to show we are going to balance this budget and we are not going
to give the bill to our children and our grandchildren.
I yield the remainder of my time.
The PRESIDING OFFICER. The Senator yields her time. The Senator from
Nevada has 25 seconds left.
Mr. REID. Madam President, that is the whole point. The Senator from
Texas has missed that. We have already done what we are asking the
American public to do. That is the whole point. That is why we made all
these cuts, and I have outlined those today, in franking and the
general expenditures of this legislative body.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Nevada has 6 seconds
remaining.
Mr. REID. I yield back the remainder of my time.
The PRESIDING OFFICER. Who yields time?

Unanimous Consent Agreement

Mr. DORGAN. Madam President, I ask unanimous consent that all time on
the pending Hutchison amendment be yielded back; that the pending
Hutchison amendment be temporarily laid aside to be disposed of
following the Mack amendment, No. 1571; that no amendments be in order
to the Hutchison amendment or to the language proposed to be stricken
by the amendment.
The PRESIDING OFFICER. All time has already been yielded back. Is
there objection to the remainder of the request? Without objection, it
is so ordered.
Mr. SIMPSON addressed the Chair.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. SIMPSON. Madam President, I want to commend the Senator from
Texas, who has been with us a rather short time in chronology but is a
wonderfully active participating Member of the U.S. Senate. She feels
strongly about this issue. Many of us may not concur, but it is
certainly important that she has presented it and done it in a very
commendable way.
And I thank the Senator from Nevada for his generosity and courtesy.

Amendment No. 1573

Mr. SIMPSON. Madam President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Wyoming [Mr. Simpson] proposes an
amendment numbered 1573.

Mr. SIMPSON. Madam President, I ask unanimous consent that the
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
On page 5, line 22, decrease the amount by $2,000,000,000.
On page 5, line 23, decrease the amount by $13,200,000,000.
On page 5, line 24, decrease the amount by $22,400,000,000.
On page 5, line 25, decrease the amount by $33,600,000,000.
On page 6, line 1, decrease the amount by $46,200,000,000.
On page 6, line 17, decrease the amount by $2,000,000,000.
On page 6, line 18, decrease the amount by $13,200,000,000.
On page 6, line 19, decrease the amount by $22,400,000,000.
On page 6, line 20, decrease the amount by $33,600,000,000.
On page 6, line 21, decrease the amount by $46,200,000,000.
On page 7, line 8, decrease the amount by $2,000,000,000.
On page 7, line 9, decrease the amount by $15,200,000,000.
On page 7, line 10, decrease the amount by $37,600,000,000.
On page 7, line 11, decrease the amount by $71,200,000,000.
On page 7, line 12, decrease the amount by
$117,400,000,000.
On page 8, line 7, decrease the amount by $2,000,000,000.
On page 8, line 8, decrease the amount by $13,200,000,000.
On page 8, line 9, decrease the amount by $22,400,000,000.
On page 8, line 10, decrease the amount by $33,600,000,000.
On page 8, line 11, decrease the amount by $46,200,000,000.
On page 9, line 14, decrease the amount by $1,300,000,000.
On page 9, line 15, decrease the amount by $8,100,000,000.
On page 9, line 16, decrease the amount by $13,200,000,000.
On page 9, line 17, decrease the amount by $19,500,000,000.
On page 9, line 18, decrease the amount by $26,500,000,000.
On page 26, line 16, decrease the amount by $200,000,000.
On page 26, line 23, decrease the amount by $600,000,000.
On page 27, line 6, decrease the amount by $1,000,000,000.
On page 27, line 13, decrease the amount by $1,300,000,000.
On page 27, line 21, decrease the amount by $600,000,000.
On page 28, line 3, decrease the amount by $3,700,000,000.
On page 28, line 10, decrease the amount by $6,200,000,000.
On page 28, line 17, decrease the amount by $9,700,000,000.
On page 28, line 24, decrease the amount by $13,900,000.
On page 30, line 21, decrease the amount by $100,000,000.
On page 31, line 3, decrease the amount by $800,000,000.
On page 31, line 10, decrease the amount by $1,500,000,000.
On page 31, line 17, decrease the amount by $2,200,000,000.
On page 31, line 24, decrease the amount by $3,000,000,000.
On page 33, line 18, decrease the amount by $100,000,000.
On page 34, line 1, decrease the amount by $500,000,000.
On page 34, line 9, decrease the amount by $800,000,000.
On page 34, line 17, decrease the amount by $1,100,000,000.
On page 34, line 25, decrease the amount by $1,500,000,000.

Mr. SIMPSON. Madam President, I have never really been much into
charts, but the principal manager of the bill, the Senator from
Tennessee, has presented me with a remarkable instrument which as you
keep pulling on, suddenly you have this remarkable pointer. I
appreciate Senator Sasser furnishing me this remarkable thing because I
want to share with you some interesting charts.
The basis of these charts is a powerful literary work of my friend
Pete Peterson and the support of the Concord Coalition. Remember, the
Concord Coalition was started by two people who have been deeply
respected in this body. I served with both of them: Senator Paul
Tsongas, of Massachusetts, a magnificent man. I enjoyed him so. Still
do. Indeed he is very vital. And Senator Warren Rudman, just a dear,
dear friend. They are doing things as united Republicans and Democrats
because the rest of us do not do them, and I do not either. We all talk
a great game. That is all we do--is talk a great game.
So let me just acquaint my colleagues with a few things on these
charts. Most of this will not be news to anybody because people like
Senator Sasser and Senator Domenici have in one way or another been
alerting us to this for years.
So it will not be news. But at some level in the human psyche, in
some dim, dark recess of our minds, we know all of the truths about
Federal spending--where it has been, where it is going. But we do not
like to talk about it. It is too, too painful. We do not like to
confront it even though it is our responsibility to do so. Instead, we
take refuge in old canards about, ``Why do we not do something?'' That
is marvelous.
Or our constituents say, ``Why don't you do what you get paid to do;
you should vote the tough votes.'' You vote the tough votes and your
constituents retire you.
That is an interesting conflict. There were several in this body who
cast tough votes in 1985 when we froze the entire Federal budget, cut
everything on Earth except Social Security but let it go up only 2
percent, and in the next election period, six of our Members
disappeared like squash vines in the wintertime. The ads in the paper
were: ``Here is the squirrel who took your Social Security. Here is the
guy who cut your veterans benefit. Here is the guy who took your
railroad retirement.''
So who is to do the heavy lifting? It is a representative Government.
People must like it that way. So we take refuge in those things.
Then they ask us about congressional perks and what we are making.
And then we say, ``Well, I pay my own Social Security, and I pay my own
health insurance, and I pay 8 percent of my salary into a pension,
instead of 7 like other Federal employees, so I do get more back. And I
pay my mortgage, groceries, gas and oil. So what is it you think I get
that you don't get?'' They say, ``I don't know, I just read it in the
Reader's Digest, that's all I know,'' or ``I heard it over one of those
talk shows.''
That is not good enough.
Then we have a field day talking about, ``Well, if we would just get
rid of foreign aid, or Lawrence Welk's house in North Dakota, or the
study of tsetse flies, or why sheep do what sheep do on the range''--
whatever it is. That is what you hear when you get home.
I then say, ``Will somebody step up to the plate and tell me who will
help me do `means testing' or `affluence testing' on--guess what--the
Social Security cost-of-living allowance which was 7 billion bucks last
year and goes out to people regardless of their net worth or their
income? You can save a lot of tsetse fly studies, and all the rest of
it, if you step up to the plate and do that.''
When we even mention that, here comes the AARP, the Committee for the
Preservation of Social Security and Medicare, the Gray Panthers, the
Pink Panthers, and every other known organization, to fill our mail
rooms to the brim with what we are doing cruelly to the aged and to the
infirm, and so on.
Foreign aid, that is a great one. It is 1 percent of the budget. It
is less than 15 billion bucks out of a budget of 1 trillion 500 billion
bucks, and half of it goes to Israel and Egypt, where it ought to go.
The results are heartening there, even through the pain of recent
times. The rest of it goes around the world, and some of it, yes, finds
its way to despotic tinhorn dictators. But 40, 50 percent of it finds
its way into the swollen belly of a starving child, and I will continue
to vote for it as long as I am here.
There is a vibrant and active and very tough constituency served by
the entitlement programs of the United States, and that makes up the
majority of our Federal budget. In deference to them, we remain
relatively silent, at least when it comes to ``specifics.'' Oh, we are
very good when it comes to generalities, but remain silent about
specific ways to slow the truly huge spending increases. So I will hold
my tongue for a bit about these energetic, spirited, often selfish,
interest groups. I wish instead to use my time to lay out, very
dispassionately, of course, the facts. It will not take but a few
minutes.
Here is one you do not want to miss--
30 years ago, entitlement spending and interest payments together
made up approximately one-third of the Federal budget. Today, they
compose two-thirds of the Federal budget. Hear us when we say that 67
percent of the budget of the United States goes out to the citizens
without us ever casting a vote. Sixty-seven percent of the budget of
the United States. is out the door without us ever stepping up to the
plate and casting a vote. Try that one.
So when we talk about cutting discretionary spending, we will never
get there. We will not get to balanced budgets by cutting Amtrak or
foreign aid. All this mandatory spending is going out the window. It is
gone, leaving nothing there to cut in discretionary. You cannot get
there.
That is one I wanted to share with you.
And then, not all entitlement programs have contributed equally to
this tremendous spending explosion. The largest increases have come
from three areas: Health care benefits, Federal pensions, and Social
Security cash; together, those three areas. Federal spending in those
areas has increased by 6.7 percent of GDP, gross domestic product,
since 1965. Those are striking figures. These other things have not
gone up like that. We think of food and housing benefits, unemployment
and welfare cash, other nonretirement cash. That is not where the rise
is. It is in health care, Federal pensions, and Social Security,
period. Forget anything else. And we all know it. That is the part that
is so curious.
But here is the greatest myth of all time, that somehow this myth is
that entitlement spending embodies Government assistance to ``the
needy.'' Almost three-quarters of all entitlement spending is given out
regardless of need. It goes out to people regardless of need or net
worth or income.
Please hear that. We do not like to hear it; our constituents do not
like to hear it, but that is where it goes. Regardless of need, three-
quarters. And only $1 out of every $6 serves to lift people above the
poverty line. That is the way it is. Every one of those figures are
completely attributed, completely correct and from several sources:
CBO, OMB, BEA, NTUF. There it is. I almost hate to bring out a chart
like that, to be called mean-spirited, ugly, and all the rest. But
somebody ought to do this now and then.

And then there are some programs that preferentially serve the poor.
For example, food stamps, Medicaid. No one is questioning the need for
those, but others like Social Security and Medicare deliver larger
benefits to those who are well off. These two tendencies virtually--
really, actually--cancel out each other to the point where households
earning over $100,000 in income receive just as much entitlement
assistance as do households that bring in less than $10,000 per year.
Look at this. Federal benefit dollars are just as likely to go to the
affluent as to the needy. Here is the column, a total of $5,560 for
that family, $5,600 here, and this is for household income over
$100,000. And only a little bit of it means tested down here with
welfare and food stamps.
There it is. It is absolutely absurd that we have to listen to the
assertion that we are taking care of the poor. We are not taking care
of the poor. We are taking care of a lot of people that are very well
off.
The common denominator of our Federal entitlement system is therefore
that it is not a system that transfers benefits from the well off to
the needy. It is, rather, a system that now transfers from the young to
the elderly, regardless of need, and that is absurd.
There is another interesting statistic; that if we do not start doing
something about it, in the year 2010, 60 percent of the domestic budget
of the United States will be going to people over 60, and the young
people will simply be ignored, apparently, at least if we allow the
greed level to continue as it does with certain senior citizens groups.
And, of course, it is entirely appropriate for society to set resources
aside to take care of Americans in their years of retirement.
At 95 my father died. He probably put $10,000 in Social Security. But
when you live to be 95, in a gracious way he wanted that money to go to
the Little League and he gave it to other groups or to his
grandchildren. I said, ``Well, Pop, maybe you should let the Government
give it to the Little League.'' And he said, ``Mind your own business
son.'' A wonderful man, a wonderful father and a magnificent human. But
that was his. He said, ``I want to give it. I put into it from the
beginning.''
What I tell others who say that: ``Well, remember what you put in
from the beginning then because if you were in Social Security from the
beginning, you put in $30 a year for the first 13 years, and then you
really got struck with a hammer blow. You put in $174 by 1960. Ladies
and gentlemen, you toadied up 174 bucks a year in 1960, and then you
got nailed $300 a year, $500 a year, $800 a year, $1,200 a year, $1,500
a year, and blood pouring out of your eyes finally $2,000 a year. Now
it is up to about $3,300 a year, and guess what? People are paying more
in Social Security now than they pay in income tax, and they are
getting very tired of it.
Then the people that come to the town meetings are getting $500 to
$700 a month out of a system where the most they ever paid in was
$3,000 a year, and that is in this year. Now, let us all step up and
put your foot on the bar rail and try to withdraw ourselves from the
elixir they present to us all.
Here we are now where we say we want to take care of Americans in
retirement, and yet they are the better off in society now, the
seniors.
It is equally appropriate to set aside, in my mind, ``something'' on
behalf of our children and our grandchildren. And yet we give, and
please get these figures, 11 times more to the elderly than we give to
our children.
There are the figures. Benefits for the elderly, 65 and over, have
shot through the roof. Since 1965, the benefit increase for those over
65, $9,632; for those under 18, the benefit increase is $655. No
society can exist when you ignore your young.
We have all been through this. My good pal Danny Rostenkowski several
years ago found some deceptively frail people pouncing all over his car
saying that they were not going to let him do catastrophic health care,
by George, which would cost them $884 a year. And guess what? If we had
done the catastrophic health care bill, which I did not vote to repeal,
we would not be in the mess we are with regard to health care. Because
if we had done catastrophic health care, 60 percent of the people who
are covered, the elderly, would have paid no supplemental premium
beyond 7 bucks a month, and then the wealthiest of all of them, the 5
percent at the top, the people that we all heard from--that was when
the mailman from Sun City had a hernia hauling the mail in here as to
what was happening to these people--those people would have had to pay
$884 a year more, and they brought it down. They destroyed it. And
thanks to this, we are now largely enraveled in a health care problem.
If we had done the catastrophic health care in a sensible way, and it
was. And oh, boy, what benefits it had. I did not hear many seniors
remembering what we had in it: 365 days of unlimited hospital care,
hospice care for a terminal illness, no copayments for hospital care,
not over 600 bucks a year for your pharmaceuticals--unbelievable--for 7
bucks a month except for the fat cats at the top who would have had to
put up $884 a year. And they crushed it, and now we are going to spend
billions of their money--billions of their money--to correct what they
could have fixed or allowed us to fix a few years ago.
Well, another recurring fiction, if I may share it with you, is that
beneficiaries of these entitlement programs are ``only getting back
what they paid in.'' I have touched on that. And there we see another
chart. That argument that they are only getting back what they paid in
is certifiable, unmitigated hogwash. They know and we know about the
Social Security and Medicare contributions collected in this country
over the years. They were inadequate to keep the system from going
virtually belly up approximately a decade ago, and people like Senator
Pat Moynihan and people of good will in both parties finally got
together and reconstructed what was headed for disaster, leaving, of
course, a group called ``notch babies,'' which we have all heard from.
Notch babies are people who received more than they ever should have
received under any scenario known to man or woman, and yet they come to
the town meetings. They do not come to mine anymore, which is very
good, actually. I said I would put a notch in one of them one day
myself.
Now, these are the people who put in the least, the least, and got
out the most. In fact, the replacement rate on Social Security for the
average recipient is about 41 or 43 percent, and a lot more of the
percentage of it goes to the wage earner, the ditch digger. He or she
gets more than the affluent. And so that is what we did, but the notch
baby was receiving up to 55 percent and it was headed for 100 percent
of what they had put in, and thanks to the blue ribbon commission on
Social Security, we corrected it. And they still come to the town
meetings, and they have received more than any other people who put in
that amount, without question. And then a year later there is a
difference in benefits received by those folks, and now they ``want
their money.'' It would only take something between $200 billion and
$400 billion over 10 years to give them what they want. And I am not
about to vote for that.
Finally, I think that issue has died down around here. Nobody has the
gumption to step up and really say that these people are aggrieved,
when they have received far above the typical replacement rate for
Social Security.
I just wanted to show you that. The payback on Social Security and
Medicare far exceeds what they have paid in plus interest. They always
say, ``If I had had that money, plus interest, and put it in an
investment, I would not be here. I want it out and I want it
separate.'' I respectfully say that is not so.
See here lifetime benefits, for a worker with a nonworking spouse,
$308,000. For new retirees, the benefit payback can be almost four
times the tax paid. Lifetime benefits for a single worker, $184,000.
Medicare, part B, is paid 25 percent by the beneficiary and 75 percent
by ``Joe Six-Pack.'' Wait until we try to correct that. The mail room
will break down. I have been through this one.
You tell me why somebody should be paying $41.10 a month, which is 25
percent of the part B premiums, while the general taxpayers are paying
75 percent regardless of their net worth or their income? You think we
will correct that in the health care debate? The mail room will break
down.
Those are some things that I want to share. I think it is very
important. I think the American people are smarter than their elected
politicians. That is the way it has always been.
You have to admire people like Senator Sasser, Senator Domenici,
former Senator Lawton Chiles, people who have worked on this through
the years. They deserve awards because they try to tell us these
things, and they do. We will not do anything, but one thing will
happen. The staff will bring to us the mail for that week and say,``Oh,
God. Don't touch that; 5,000 cards from outraged senior citizens.'' And
they are highly organized. I can tell you that. I think they are
feeling guilty, at least if they have children and grandchildren,
because right now we have a situation where three people are paying
into the Social Security System and one taking out.
When I was a freshman at the University of Wyoming, there were 16
loyal workers contributing to Social Security and one taking out. Today
there are 3.2, and in 30 years there will be two people paying in and
one taking out. Can you imagine the generational struggle that will
take place in this country when two fine working people are putting in
$12,500 each so some guy can get $25,000 out, regardless of his net
worth or his income?
And pay close attention to a little item in this budget this year, in
the words of Leon Panetta, who is gutsy beyond belief. It is in there.
It says that unless we do something, all generations born from this day
forward will be paying 82 percent of their wages to sustain these
systems in the United States: Social Security, Medicare, Medicaid--82
percent. That is where we are.
These benefits are so out of control that there are some projections
which indicate, as I say, that they could by themselves create payroll
taxes above 50 percent by the year 2040. Well, I do not claim that will
happen. The latter is a ``worse-case'' scenario.
Social Security is not rising nearly as quickly as is Medicare. But
it is clear that the more pessimistic projection is nothing short of
disastrous for our country. Yet the most optimistic projections are
that come the year 2040, as I say, there will be only two workers
putting anything in. They will be required to fund more than $17
trillion in outlays in Medicare, Social Security, Federal pensions, and
interest payments promised to just those future beneficiaries who are
already alive.
So then let me conclude, because the managers want to get on with
their work. I will obviously have to go back and begin answering the
phone, which will be ringing off the hook far into the night.
The ``aging of America'' means that a growing number of Social
Security and Medicare recipients must be supported by worker paychecks,
two workers to put in the bucks and one to take them out, regardless of
their net worth or their income. And unless the current policy is
reformed, it could cost future workers a huge chunk of their payroll in
taxes. There it is. And there is no question about where that goes, in
any scenario.
Finally, today's adults are promised $14 trillion more in benefits
than they will ever earn through payroll ``contributions.'' In 1991,
unfunded benefit liabilities amounted to $14 trillion in this system.
So there you are, America.
That is an expectation that can only be met by means of a colossal
and economically ruinous injustice against future generations. That is
the figure in the President's budget. If that was President Bush or
President Reagan, they would have had a fainting spell around the city.
It comes from a gutsy guy named Leon Panetta, who stuck it in there
because he and his able Deputy Alice Rivlin know what is happening in
America. That is what is happening in America.
So I am sure the AARP will gear up, and we will hear from all of
them. It will be a riotous time when we deal with these really gut-hard
issues, and we have to do it.
There are only two options for changing this outlook. One is to shift
some of that tax burden from future generations onto current ones. That
is the policy that was pursued by this President and this Congress last
August. We passed a massive tax increase, one which the administration
claims cut that ``future tax rate'' from 93 percent to 82 percent, by
asking today's generations to pay $250 billion more in taxes.
But we cannot get very far with that choice. ``Shifting'' some of
tomorrow's tax burden onto today's generations may make things more
fair but it does not change the fundamental problem. The essence of
that problem is that we are promising levels of benefits that require
exorbitant, confiscatory tax rates--whether collected today or
tomorrow.
This brings me to describe what I am offering today. This is an
amendment that would slow the rate of growth in a number of mandatory
spending categories. I want to stress that point--my amendment would
slow growth rates, not make ``cuts,'' in entitlement programs.
Last September, the bipartisan Concord Coalition--a group headed up
by our great friends and former Senators Paul Tsongas and Warren Rudman
to dramatize the perils of our Federal deficit--unveiled a program to
balance the budget by the end of the decade.
The essential point that comes through loud and clear in reviewing
their program is that we cannot balance the budget without effecting
changes in the mandatory entitlement system. If we cannot balance the
budget, we cannot make any progress in reducing the total debt that we
are leaving to future generations. You can't get there by cuts in
foreign aid, in defense, or even solely through appropriations cuts at
all. You have to ``go where the money is.''
But even that is not the real point. We ought not to ``go after''
entitlement spending simply because it is the largest and fastest
rising part of the Federal budget. We ought to review our entitlement
system because it so little resembles what an ``entitlement system''
ought to be.
It is my view--and, I believe, the view of many Senators--that the
entitlement system should represent a ``safety net'' for those
Americans who, whether from poverty, illness, or age, are unable to
fully provide for themselves. It is not intended to be a system of
dependency for those Americans who do not need it. It is not intended
to provide incentives for healthy, fully productive Americans to spend
one-third of their lives in retirement, at the taxpayer's expense.
Because of this we ought, for a number of reasons, to take a close
look at proposals that seek to slow the flow of dollars from working
Americans to entitlement beneficiaries who are better off than those
who are supporting them. There is no reason for Federal spending to
soar so that we can maintain a flow of benefits ``upstream.''
The Concord Coalition unveiled a proposal to ``means-test''
entitlement benefits for those households who already have annual
incomes above $40,000 per year. This was a critical component of what
the Concord Coalition concluded was necessary to balance the budget. I
am going to call it ``affluence testing''--sounds better.
I am not out here to seek to implement the Concord Coalition's
proposal. Let me make that clear from the beginning. In the first
place, there are valid, legitimate questions to be asked about the
efficacy of such an ``affluence-test.'' One of them is whether or not
income is even an accurate measurement of the wealth of elderly
beneficiaries. Perhaps total assets held, or accumulated wealth, is a
better definition of ``means'' for the purposes of determining what
kind of affluence benefits these households should receive. And
further, there are enforcement questions; it is not at all clear
whether seeking to withhold benefits as a function of income is an
enforceable proposition, or whether it invites evasion and abuse of a
type that we have seen with Medicaid and other ``need-based'' programs.
It could well be that ``means-testing'' is best enforced through the
Tax Code, or by some other means different from that suggested by the
Concord Coalition.

These are the types of issues that I will be studying as a member of
the President's Bipartisan Commission on Entitlement Reform. My
discussion of this amendment is not intented to preempt those findings
in any way.
The Congressional Budget Office [CBO] has ``scored'' the effects over
5 years, of implementing the Concord Coalition's proposal immediately.
Instead, my amendment would cut spending growth by an amount equal to
the savings that would be achieved if we were to slowly phase in the
Concord Coalition's program--20 percent each year, for 5 years, until
finally reaching full implementation in 1999.
There are other points that I would like to make in discussing my
amendment.
The first is that an amendment to the budget resolution does not
implement a policy. That is left to the appropriate committees. What it
does do is to set revenue and spending targets for Congress to meet.
Thus, my amendment does not introduce ``means-testing'' or any other
policy change. Let no one come forth to the field of combat and say
that we are voting on ``means-testing'' entitlement benefits. That is
not done in a budget resolution. My amendment leaves the door open to
achieving savings by any means that the appropriate committees choose.
I have discussed the Concord Coalition's ``means-testing'' proposal
because I do not believe that such an amendment should be offered as a
vague ``cap'' or ``black box,'' with no honesty about the difficult
choices that are necessary to adhere to such spending restrictions. It
is my aim for the Senate to confront the types of policy changes that
will be necessary if we are to get mandatory spending under control.
Sooner or later, this body will have to do that--I can assure my
colleagues that the longer we wait, the more painful it will be.
The second point I seek to make is that I am not talking about making
any ``cuts.'' I know that I will hear a chorus of howls and shrieks
from certain interest groups, alleging that such an amendment would
``cut'' Medicare or Social Security.
In fact, that is one reason why I have phased in the Concord
Coalition savings over 5 years--to ensure that we do not have a ``cut''
in current dollars from 1 year to the next.
An amendment to the budget resolution makes for confusing reading, so
let me describe my amendment to my fellow Senators.
My amendment would make changes in projected Medicaid spending. I
will be curious as to whether the changes I suggest can be defined as
``a cut.'' Here are the outlays that will result in the Medicaid
portion of the budget if my amendment is adopted; $122.5 billion in
1995, $135.3 billion in 1996, $149.2 billion in 1997, $164.4 billion in
1998, and $181.2 billion in 1999. If there are any ``cuts'' in there, I
am quite lost and befuddled. There is not an annual change in that
series that is less than a 10 percent increase. Those are increases in
real dollars, in current dollars, relative to GNP--pick your measure.
These remain increases in every sense of the word.
I know, however, that people will call this type of change a ``cut.''
But let me read from page 75 of the budget resolution--the very
document that we are deliberating today. ``The baseline concept has
been misused to portray policies that would simply slow down the
increase in spending as spending reductions.'' That is so very true.
And yet I fully expect that my amendment would be opposed on the basis
of the ``cuts'' it would require.

Let me now discuss Medicare. What would my amendment do to Medicare?
We would have outlays of $159.9 billion in 1995, $174.5 billion in
1996, $189.9 billion in 1997, $205.4 billion in 1998, and $225.1
billion in 1999. Again, my amendment would effect increases of at least
8 percent every year. Those are increases in real dollars, in current
dollars, or however you want to measure.
And now, the big one: Social Security. My amendment would provide for
a growth in Social Security--from $286.3 billion in 1995 to $310.5
billion in 1999. I know how people are going to respond to that one.
Although most Americans would consider that an increase, people will
point out that this growth will be less than inflation, meaning that,
if we did not effect some kind of ``means-testing,'' then ``COLA's,''
at least, would be in jeopardy.
I expect to hear some savage criticisms of my amendment on that basis
alone. But I would say to my colleagues: These difficult choices,
between means-testing, COLA eliminations, and retirement age increases,
are not created by Al Simpson.
These are choices imposed on this Congress by the inexorable progress
of budgetary events currently beyond our control. I am not the author
of this predicament; nor does my amendment create it. This predicament
exists in any event, and it will impose itself on this and all future
Congresses.
Let me reiterate my principal points for those who may have missed
them. First, my amendment would reduce projected spending baselines by
an amount equal to what you would get if you phased in the Concord
Coalition's ``means-testing'' proposal over 5 years. Second, my
amendment does not dictate that we achieve the savings in that way. All
options are still open to this Senate. Third, my amendment does not
require Congress to ``cut'' any of these programs. It would require us
to develop a means to slow only a little bit of the projected rate of
increase in these programs.
It is my hope that this amendment will force the Senate to confront
just a small fraction of the types of measures which will be necessary
to get our fiscal house in order. My amendment does not come close to
balancing the budget over 5 years. We have to go far, far beyond this
if we are to get to that point. But if we are talking about getting
Government spending under control, this is the sort of thing we will
have to do.
It is the sort of thing that we must do--but I know quite well that
we will not do it today. I have been around this Chamber long enough to
be able to count votes pretty well and there aren't enough enthusiasts
in this body who are willing to cast votes in favor of this amendment.
I will withdraw the amendment, for it would garner at least 10 votes.
Because of the clogging that would take place in the elevator area
during the rollcall on that one, we would not be able to get to work
for 2 days. They would be camped out in the streets saying, ``Don't cut
any of this or that or we will all die. Everybody will be broke. We
will be destroyed.'' And remember the greatest, the most egregious one
of all. That is when they say, ``you are cutting Medicare and
Medicaid.'' Do not buy it, America. Wake up and smell the coffee, for
God's sakes, because Medicaid is going up 29 percent. And we are saying
let us let it go up only 10 percent, and that is called a ``cut'' by
these groups. Medicare is going up 13 percent, and they say, ``Oh, you
let it go up only 8 percent. That is a cut.'' It is not a cut. It is an
8-percent increase.
So wake up and have one on me. If you do we will do the treats out in
Wyoming.
The PRESIDING OFFICER. Without objection, the Senator has the right
to withdraw the amendment. The Senator asked to do that.
The amendment (No. 1573) was withdrawn.
Mr. GRAMM addressed the Chair.
The PRESIDING OFFICER. The Senator from Texas.

Amendment No. 1574

(Purpose: To reduce the deficit, reduce the tax burden on
children, and promote the private pursuit of happiness)

Mr. GRAMM. Madam President, I send an amendment to the desk and ask
for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Texas [Mr. Gramm] proposes an amendment
numbered 1574.

Mr. GRAMM. Madam President, I ask unanimous consent that reading of
the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

On page 3, decrease the amount on line 5 by
$10,380,000,000.
On page 3, decrease the amount on line 6 by
$26,000,000,000.
On page 3, decrease the amount on line 7 by
$27,600,000,000.
On page 3, decrease the amount on line 8 by
$30,000,000,000.
On page 3, decrease the amount on line 9 by
$32,300,000,000.
On page 3, decrease the amount on line 13 by
$10,380,000,000.
On page 3, decrease the amount on line 14 by
$20,000,000,000.
On page 3, decrease the amount on line 15 by
$27,600,000,000.
On page 3, decrease the amount on line 16 by
$30,000,000,000.
On page 3, decrease the amount on line 17 by
$32,300,000,000.
On page 4, decrease the amount on line 7 by
$10,380,000,000.
On page 4, decrease the amount on line 8 by
$26,000,000,000.
On page 4, decrease the amount on line 9 by
$27,600,000,000.
On page 4, decrease the amount on line 10 by
$30,000,000,000.
On page 4, decrease the amount on line 11 by
$32,300,000,000.
On page 4, decrease the amount on line 15 by
$10,380,000,000.
On page 4, decrease the amount on line 16 by
$26,000,000,000.
On page 4, decrease the amount on line 17 by
$27,600,000,000.
On page 4, decrease the amount on line 18 by
$30,000,000,000.
On page 4, decrease the amount on line 19 by
$32,300,000,000.
On page 5, decrease the amount on line 1 by
$34,437,000,000.
On page 5, decrease the amount on line 2 by
$41,896,000,000.
On page 5, decrease the amount on line 3 by
$46,641,000,000.
On page 5, decrease the amount on line 4 by
$40,493,000,000.
On page 5, decrease the amount on line 5 by
$45,034,000,000.
On page 5, decrease the amount on line 11 by
$34,437,000,000.
On page 5, decrease the amount on line 12 by
$41,896,000,000.
On page 5, decrease the amount on line 13 by
$46,641,000,000.
On page 5, decrease the amount on line 14 by
$40,493,000,000.
On page 5, decrease the amount on line 15 by
$45,034,000,000.
On page 5, decrease the amount on line 22 by
$10,584,000,000.
On page 5, decrease the amount on line 23 by
$29,223,000,000.
On page 5, decrease the amount on line 24 by
$35,986,000,000.
On page 5, decrease the amount on line 25 by
$41,131,000,000.
On page 6, decrease the amount on line 1 by
$40,215,000,000.
On page 6, decrease the amount on line 7 by
$10,584,000,000.
On page 6, decrease the amount on line 8 by
$29,223,000,000.
On page 6, decrease the amount on line 9 by
$35,986,000,000.
On page 6, decrease the amount on line 10 by
$41,131,000,000.
On page 6, decrease the amount on line 11 by
$40,215,000,000.
On page 6, decrease the amount on line 17 by $204,000,000.
On page 6, decrease the amount on line 18 by
$3,223,000,000.
On page 6, decrease the amount on line 19 by
$8,386,000,000.
On page 6, decrease the amount on line 20 by
$11,131,000,000.
On page 6, decrease the amount on line 21 by
$7,915,000,000.
On page 7, decrease the amount on line 1 by $204,000,000.
On page 7, decrease the amount on line 2 by $3,223,000,000.
On page 7, decrease the amount on line 3 by $8,386,000,000.
On page 7, decrease the amount on line 4 by
$11,131,000,000.
On page 7, decrease the amount on line 5 by $7,915,000,000.
On page 7, decrease the amount on line 8 by $204,000,000.
On page 7, decrease the amount on line 9 by $3,427,000,000.
On page 7, decrease the amount on line 10 by
$11,813,000,000.
On page 7, decrease the amount on line 11 by
$22,944,000,000.
On page 7, decrease the amount on line 12 by
$30,859,000,000.
On page 8, decrease the amount on line 7 by $204,000,000.
On page 8, decrease the amount on line 8 by $3,223,000,000.
On page 8, decrease the amount on line 9 by $8,386,000,000.
On page 8, decrease the amount on line 10 by
$11,131,000,000.
On page 8, decrease the amount on line 11 by
$7,915,000,000.
On page 10, decrease the amount on line 3 by $100,000,000.
On page 11, increase the amount on line 6 by $100,000,000.
On page 11, decrease the amount on line 14 by
$4,000,000,000.
On page 11, decrease the amount on line 15 by
$1,300,000,000.
On page 11, decrease the amount on line 22 by
$3,900,000,000.
On page 11, decrease the amount on line 23 by
$2,500,000,000.
On page 12, decrease the amount on line 5 by
$4,100,000,000.
On page 12, decrease the amount on line 6 by
$3,200,000,000.
On page 12, decrease the amount on line 13 by
$4,000,000,000.
On page 12, decrease the amount on line 14 by
$4,000,000,000.
On page 12, decrease the amount on line 21 by
$3,800,000,000.
On page 12, decrease the amount on line 22 by
$3,900,000,000.
On page 13, decrease the amount on line 7 by $400,000,000.
On page 13, decrease the amount on line 8 by $200,000,000.
On page 13, decrease the amount on line 14 by $500,000,000.
On page 13, decrease the amount on line 15 by $400,000,000.
On page 13, decrease the amount on line 21 by $600,000,000.
On page 13, decrease the amount on line 22 by $500,000,000.
On page 14, decrease the amount on line 3 by $700,000,000.
On page 14, decrease the amount on line 4 by $600,000,000.
On page 14, decrease the amount on line 10 by $800,000,000.
On page 14, decrease the amount on line 11 by $800,000,000.
On page 14, decrease the amount on line 18 by $900,000,000.
On page 14, decrease the amount on line 19 by $300,000,000.
On page 15, decrease the amount on line 2 by
$1,100,000,000.
On page 15, decrease the amount on line 3 by $900,000,000.
On page 15, decrease the amount on line 10 by
$1,400,000,000.
On page 15, decrease the amount on line 11 by
$1,300,000,000.
On page 15, decrease the amount on line 18 by
$1,800,000,000.
On page 15, decrease the amount on line 19 by
$1,800,000,000.
On page 16, decrease the amount on line 2 by
$2,300,000,000.
On page 16, decrease the amount on line 3 by
$2,200,000,000.
On page 16, decrease the amount on line 11 by
$4,300,000,000.
On page 16, decrease the amount on line 12 by $900,000,000.
On page 16, decrease the amount on line 18 by
$4,500,000,000.
On page 16, decrease the amount on line 19 by
$2,100,000,000.
On page 16, decrease the amount on line 25 by
$4,300,000,000.
On page 17, decrease the amount on line 1 by
$3,200,000,000.
On page 17, decrease the amount on line 7 by
$4,700,000,000.
On page 17, decrease the amount on line 8 by
$4,000,000,000.
On page 17, decrease the amount on line 14 by
$4,900,000,000.
On page 17, decrease the amount on line 15 by
$4,500,000,000.
On page 17, decrease the amount on line 22 by $500,000,000.
On page 17, decrease the amount on line 23 by $300,000,000.
On page 18, decrease the amount on line 5 by $500,000,000.
On page 18, decrease the amount on line 6 by $600,000,000.
On page 18, decrease the amount on line 13 by $600,000,000.
On page 18, decrease the amount on line 14 by $700,000,000.
On page 18, decrease the amount on line 22 by $600,000,000.
On page 19, decrease the amount on line 5 by $900,000,000.
On page 19, decrease the amount on line 6 by $800,000,000.
On page 19, decrease the amount on line 14 by
$1,700,000,000.
On page 19, decrease the amount on line 15 by
$1,100,000,000.
On page 20, decrease the amount on line 5 by
$2,600,000,000.
On page 20, decrease the amount on line 6 by
$2,200,000,000.
On page 20, decrease the amount on line 13 by
$3,100,000,000.
On page 20, decrease the amount on line 14 by
$2,800,000,000.
On page 20, decrease the amount on line 21 by
$4,200,000,000.
On page 20, decrease the amount on line 22 by
$3,900,000,000.
On page 19, decrease the amount on line 22 by
$2,200,000,000.
On page 19, decrease the amount on line 23 by
$1,700,000,000.
On page 21, decrease the amount on line 6 by
$8,300,000,000.
On page 21, decrease the amount on line 7 by
$5,400,000,000.
On page 21, decrease the amount on line 14 by
$7,500,000,000.
On page 21, decrease the amount on line 15 by
$6,600,000,000.
On page 21, decrease the amount on line 22 by
$7,600,000,000.
On page 21, decrease the amount on line 23 by
$7,500,000,000.
On page 22, decrease the amount on line 5 by
$6,800,000,000.
On page 22, decrease the amount on line 6 by
$7,900,000,000.
On page 22, decrease the amount on line 13 by
$9,000,000,000.
On page 22, decrease the amount on line 14 by
$8,400,000,000.
On page 22, decrease the amount on line 23 by
$4,800,000,000.
On page 22, decrease the amount on line 24 by $300,000,000.
On page 23, decrease the amount on line 7 by
$4,400,000,000.
On page 23, decrease the amount on line 8 by
$3,000,000,000.
On page 23, decrease the amount on line 15 by
$4,300,000,000.
On page 23, decrease the amount on line 16 by
$3,400,000,000.
On page 23, decrease the amount on line 23 by
$4,700,000,000.
On page 23, decrease the amount on line 24 by
$3,900,000,000.
On page 24, decrease the amount on line 7 by
$4,100,000,000.
On page 24, decrease the amount on line 8 by
$4,100,000,000.
On page 24, decrease the amount on line 17 by
$6,900,000,000.
On page 24, decrease the amount on line 18 by
$2,200,000,000.
On page 24, decrease the amount on line 25 by
$8,500,000,000.
On page 25, decrease the amount on line 1 by
$6,500,000,000.
On page 25, decrease the amount on line 8 by
$9,900,000,000.
On page 25, decrease the amount on line 9 by
$8,900,000,000.
On page 25, decrease the amount on line 16 by
$11,000,000,000.
On page 25, decrease the amount on line 17 by
$10,400,000,000.
On page 25, decrease the amount on line 24 by
$12,100,000,000.
On page 25, decrease the amount on line 25 by
$11,500,000,000.
On page 26, decrease the amount on line 8 by
$1,200,000,000.
On page 26, decrease the amount on line 9 by $500,000,000.
On page 26, decrease the amount on line 12 by
$1,900,000,000.
On page 26, decrease the amount on line 16 by
$1,600,000,000.
On page 26, decrease the amount on line 22 by
$2,700,000,000.
On page 26, decrease the amount on line 23 by
$2,500,000,000.
On page 27, decrease the amount on line 5 by
$2,900,000,000.
On page 27, decrease the amount on line 6 by
$2,900,000,000.
On page 27, decrease the amount on line 12 by
$3,700,000,000.
On page 27, decrease the amount on line 13 by
$3,400,000,000.
On page 27, decrease the amount on line 20 by $100,000,000.
On page 27, decrease the amount on line 21 by $100,000,000.
On page 28, decrease the amount on line 2 by $100,000,000.
On page 28, decrease the amount on line 3 by $100,000,000.
On page 28, decrease the amount on line 9 by $100,000,000.
On page 28, decrease the amount on line 10 by $100,000,000.
On page 28, decrease the amount on line 16 by $100,000,000.
On page 28, decrease the amount on line 17 by $100,000,000.
On page 28, decrease the amount on line 23 by $200,000,000.
On page 28, decrease the amount on line 24 by $200,000,000.
On page 30, decrease the amount on line 20 by
$7,200,000,000.
On page 30, decrease the amount on line 21 by $800,000,000.
On page 31, decrease the amount on line 2 by
$9,600,000,000.
On page 31, decrease the amount on line 3 by
$1,300,000,000.
On page 31, decrease the amount on line 9 by
$11,300,000,000.
On page 31, decrease the amount on line 10 by
$3,000,000,000.
On page 31, decrease the amount on line 16 by
$7,100,000,000.
On page 31, decrease the amount on line 17 by
$7,800,000,000.
On page 31, decrease the amount on line 23 by
$17,200,000,000.
On page 31, decrease the amount on line 24 by
$6,500,000,000.
On page 33, decrease the amount on line 17 by $700,000,000.
On page 33, decrease the amount on line 18 by $300,000,000.
On page 33, decrease the amount on line 25 by
$1,200,000,000.
On page 34, decrease the amount on line 1 by
$1,600,000,000.
On page 34, decrease the amount on line 8 by
$1,900,000,000.
On page 34, decrease the amount on line 9 by
$1,800,000,000.
On page 34, decrease the amount on line 16 by
$2,000,000,000.
On page 34, decrease the amount on line 17 by
$1,900,000,000.
On page 34, decrease the amount on line 24 by
$1,700,000,000.
On page 34, decrease the amount on line 25 by
$1,400,000,000.
On page 35, decrease the amount on line 8 by $337,000,000.
On page 35, decrease the amount on line 9 by $584,000,000.
On page 35, decrease the amount on line 15 by $204,000,000.
On page 35, increase the amount on line 16 by $669,000,000.
On page 35, increase the amount on line 22 by $721,000,000.
On page 35, increase the amount on line 23 by
$1,476,000,000.
On page 36, increase the amount on line 5 by
$2,172,000,000.
On page 36, increase the amount on line 6 by
$2,534,000,000.
On page 36, increase the amount on line 12 by
$3,273,000,000.
On page 36, increase the amount on line 13 by
$4,092,000,000.
On page 36, decrease the amount on line 20 by $800,000,000.
On page 37, decrease the amount on line 21 by $100,000,000.
On page 37, decrease the amount on line 2 by $600,000,000.
On page 37, decrease the amount on line 3 by
$1,700,000,000.
On page 37, decrease the amount on line 9 by
$1,100,000,000.
On page 37, decrease the amount on line 10 by
$1,800,000,000.
On page 37, decrease the amount on line 16 by
$1,500,000,000.
On page 37, decrease the amount on line 17 by
$2,300,000,000.
On page 37, decrease the amount on line 23 by
$2,500,000,000.
On page 37, decrease the amount on line 24 by
$3,400,000,000.
On page 38, decrease the amount on line 13 by $92,000,000.
On page 38, decrease the amount on line 14 by $92,000,000.
On page 38, decrease the amount on line 20 by $462,000,000.
On page 38, decrease the amount on line 21 by $462,000,000.
On page 39, decrease the amount on line 2 by $965,000,000.
On page 39, decrease the amount on line 3 by $965,000,000.
On page 39, decrease the amount on line 9 by
$1,107,000,000.
On page 39, decrease the amount on line 10 by
$1,107,000,000.
On page 39, decrease the amount on line 25 by $92,000,000.
On page 40, decrease the amount on line 1 by $92,000,000.
On page 40, decrease the amount on line 7 by $462,000,000.
On page 40, decrease the amount on line 8 by $462,000,000.
On page 40, decrease the amount on line 13 by $965,000,000.
On page 40, decrease the amount on line 14 by $965,000,000.
On page 40, decrease the amount on line 21 by
$1,107,000,000.
On page 40, decrease the amount on line 22 by
$1,107,000,000.
On page 41, decrease the amount on line 4 by $92,000,000.
On page 41, decrease the amount on line 5 by $462,000,000.
On page 41, decrease the amount on line 6 by $965,000,000.
On page 41, decrease the amount on line 7 by
$1,107,000,000.
On page 41, increase the amount on line 11 by
$7,800,000,000.
On page 41, increase the amount on line 12 by
$3,800,000,000.
On page 41, increase the amount on line 18 by
$4,900,000,000.
On page 41, increase the amount on line 19 by $800,000,000.
On page 41, increase the amount on line 25 by
$5,600,000,000.
On page 42, increase the amount on line 1 by
$3,100,000,000.
On page 42, increase the amount on line 7 by
$8,700,000,000.
On page 42, increase the amount on line 8 by
$8,300,000,000.
On page 42, increase the amount on line 14 by
$20,100,000,000.
On page 42, increase the amount on line 15 by
$11,800,000,000.
On page 70, increase the amount on line 21 by
$41,896,000,000.
On page 70, increase the amount on line 22 by
$29,223,000,000.
On page 70, increase the amount on line 24 by
$46,641,000,000.
On page 70, increase the amount on line 25 by
$35,986,000,000.
On page 71, increase the amount on line 7 by
$40,493,000,000.
On page 71, increase the amount on line 3 by
$41,131,000,000.

Mr. GRAMM. Madam President, I have sent to the desk what some will
view as a radical amendment. We have voted on several amendments today.
We voted on several yesterday. Most of those amendments made only
marginal changes: Take a little money from here; put a little money
there; sustain a marginal cut here in discretionary spending versus a
marginal cut there in entitlement spending.
The amendment that I am sending to the desk represents a dramatic
departure from budgeting as we have practiced it since 1982.
To save everybody's time, let me describe the amendment in a little
bit of detail. Then let me talk about the issue in terms of what it is
really about. And I will try to do all of that in such a way as to
deviate from my background as a school teacher and get my presentation
finished by the time that we start voting on amendments at 3 o'clock.
My amendment makes two kinds of cuts. First of all, it accepts every
cut in the Clinton budget, but accepts none of the add-ons. But, in
addition, it fully funds the FBI, the U.S. Attorney's office, justice
assistance, DEA, INS, U.S. Marshals, and organized crime drug task
forces.
In other words, it takes every cut in the Clinton budget except,
unlike the Clinton budget, it fully funds our law enforcement effort.
It takes none of the President's add-ons. In the process, it saves $72
billion over a 5-year period.
Second, once you have made those cuts it freezes for 5 years the
authority to spend or what we call budget authority which is just the
right to spend money, and that saves $85 billion.
Then it does two things with the money. First, it applies some of it
to deficit reduction. Taken with the Grassley-Exon amendment that was
adopted in committee, it reduces the deficit by $57 billion as compared
to the original budget.
Then, second, it takes the remaining $126 billion and it uses that to
fund a doubling of the child exemption, the deduction that people get
on their income taxes, and will allow them to keep more of their money
to raise, to feed, to clothe, to educate, to house their children. That
current dependent deduction is $2,350, which is about a third the
level, in real dollars after inflation, that existed in 1950.
It raises that dependent exemption, so that families can keep more of
what they earn, from $2,350 to $4,700.
So what the amendment before us does is, it takes all the President's
savings, and it fully funds law enforcement; it freezes discretionary
spending for 5 years; then it dramatically reduces the deficit, and it
doubles the dependent exemption for every working family in America.
This dependent exemption will mean that American families with
children will get to keep more of their own money, and they will get to
spend it. I am sure someone will say, well, there probably is a rich
person in America somewhere with a child, and since you have at least
one rich person that might benefit, then we do not want to give this to
anybody. I remind my colleagues, that, as we are all aware, 90 percent
of the savings of doubling the dependent exemption for children would
go to families making less than $75,000 a year. Under existing law, in
fact, the ability to use deductions starts phasing out at $122,500.
What is the purpose of this amendment? Well, the purpose of this
amendment is to control Government spending and to give money back to
working families that they earned in the first place, and to let them
spend the money themselves.
I know some of my colleagues want to say that by freezing spending,
you are going to produce a situation where less money is being spent on
housing; less money is being spent on nutrition; less money is being
spent on education. But I respond by saying that is not true.
It is true that less money will be spent by Government on these
things, but what my amendment does, which some in this body will call
radical, is it lets families spend their own money on these things. It
takes the view that we know Government, and we know how it works, and
we know how it does not work, and we know American families, and we
know the difference. By doubling the personal exemption for children,
what we are going to do is not cut spending on housing, nutrition, or
education, we are simply going to have different people spending the
money.
The existing budget offered and supported by Democratic colleagues
says: Let Government spend the money.
My amendment says: Let the families spend the money.
I know Government, I know the family, and I know the difference. I
believe that by letting families keep more of what they earn to invest
in housing, feeding, and educating their own children, they will do a
better job, and that American children will be better housed, better
fed, better educated, and our society will be richer, freer, and
happier.
What am I trying to respond to here, Madam President? Well, let me
try to summarize it as follows: In the last 2 months, we have had three
or four different polls that have shown something I think is pretty
startling about our country.
In the last 2 or 3 months, we have had three different pollsters find
that when you ask Americans, ``Do you believe you are better off than
your parents were?'' by a slight majority, people say, ``No.''
Then when they ask people, ``Do you feel your children are going to
do better than you have done?'' by almost a 2-to-1 margin, today, in
1994, Americans say, ``No.''
What we are seeing, Madam President, is an assault on the American
dream. Like many Members of this body, I grew up in a family where
neither of my parents graduated from high school; yet, my mother never
had any doubt in the world that I was going to graduate from college. I
fought it, resisted it, and they kept trying to vaccinate me with
learning. I failed the third, seventh, and ninth grades, but my mother
prodded me every step of the way through college and through a Ph.D. in
economics. In the world I grew up in, in the 1950's and 1960's,
mothers' dreams did not die easily in America. The real tragedy of the
1990's is that all over our country, mothers' dreams today are dying. I
believe that something needs to be done about it.
Why is it that Americans are so worried about the future? Why is it
that by almost a 2-to-1 margin, Americans believe that their children
are not going to do better than they are doing? What has happened to
this pillar of American society called the ``American dream''?
Well, I think there are a lot of reasons that the dream is fading.
Part of it is the ineffectiveness of Government services in education
and in law enforcement. Part of it is the explosion of Government
bureaucracy, where small business people feel that Government exists to
put them out of business. And whether Government is out to do it, or
whether it is just happening, people see it happening every day, and
they do not believe their children will have the same opportunity to
start out with a dream of owning their own business and making it
prosper and grow.
The part of the American dream that is fading that I am trying to
deal with here has to do with the family. In 1950, the average American
family making the median income with two children sent $1 out of every
$50 it earned to Washington, DC. Let me repeat that statistic: In 1950,
the average American family with two children that made the median
income sent $1 out of every $50 it earned to Washington, which meant
that $49 out of every $50 it kept and either spent at the State level
in taxes or, more importantly, the vast majority of that money retained
by the average working family in 1950 was invested in its future and in
the future of its children.
Today, the average American family sends $1 out of every $4 it earns
to Washington, DC. When you take State and local taxes, which have
exploded since the 1950's, what you are finding is that the average
working family is giving more and more and more of its money to
Government, and it is getting to keep less and less. In fact, new
statistics indicate that in a two-wage-earner family, the second wage
earner is sending to the Government, as compared to the situation that
existed in 1950, two-thirds of his or her income. If you have a couple,
where both the husband and wife work, as compared to 1950, the second
wage earner is sending two-thirds of the income to Washington, DC, to
fund more Government, instead of investing it in their family and their
future.
What I have proposed to do, Madam President, is to reverse that, to
take the President's cuts, to freeze discretionary spending, to take
part of that money and apply it to deficit reduction but to give the
rest of the money back to working families by doubling the dependent
child exemption so that families can invest their money in their
future, so that families can make decisions about their expenditures on
housing, education, and nutrition.

I believe that this is the kind of change in public policy we need.
I think that it is very dangerous in America when, by a margin of
more than 2 to 1, parents believe that their children are not likely to
do better than they have done. That is a fundamental assault on the
American dream and on American society.
I submit, Madam President, that one of the reasons that is so is that
in the last 40 years we have seen an explosion in Government. Whereas,
the average family with children was then sending $1 of every $50 to
Washington, today it is sending $1 out of every $4. I am trying to
reverse that.
This does not raise the child-dependent exemption to the level that
existed in 1950, but it takes us in that direction. It is an important
first step. I hope my colleagues will adopt it.
I know that some are going to get up and say the way we are doing
budgets now, since the 1990 budget summit agreement is if, you want to
let people keep more money you have to cut it out of certain kinds of
expenditures. Madam President, we are capable of changing that law
right here on the floor of the Senate. We are capable of waiving that
requirement.
Some are going to say that is the way we did it. The point is the way
we are doing it is not working. I want to make a dramatic change. That
is what this amendment is about. It is about privatizing worker income.
It is about letting families invest in their future.
I see I have several colleagues here and I would like, Madam
President, to yield 5 minutes to the distinguished Senator from Indiana
[Mr. Coats].
The PRESIDING OFFICER. The Senator from Indiana is recognized for 5
minutes.
I remind Senators that at 3 o'clock, according to the previous order,
there will be several back-to-back votes.
Mr. COATS. Madam President, I may not use all the 5 minutes I have.
Madam President, when you look at the Tax Code, its seems that
everyone gets a special tax break. But no one deserves or needs it more
than the most special, special interest of all--the family.
Earlier today, the Senate rejected a budget alternative that would
have provided much-needed tax relief to hard-working middle class
families in the form of a $500 family tax credit.
The Gramm-Coats amendment offers another chance for Senators to allow
families to keep more of their hard-earned tax dollars.

WHAT OUR AMENDMENT DOES

Our amendment doubles the dependent exemption from the current $2,350
to $4,500 a year.
The amendment not only pays for a doubling of the exemption, but it
also fully funds the Senate crime bill and it reduces the deficit by an
additional $31 billion.
The amendment would accept the nondefense discretionary reductions
proposed in the President's budget, except for cuts proposed for crime-
fighting agencies--FBI, U.S. Attorney's Office, Justice Assistance,
DEA, INS, U.S. Marshals and organized crime drug enforcement--which
would be restored.
In addition, it would freeze budget authority for remaining
nondefense discretionary spending to achieve a total budget authority
freeze over 5 years.
The question our amendment asks is fundamental: Would a family rather
have more money in their pockets to spend as they choose or would they
rather have bigger Government in Washington that offers little to the
average family?

WHY WE NEED TO PROVIDE TAX RELIEF TO FAMILIES

Why is this measure needed? It's needed because over the last several
decades, tax burdens have been radically redistributed--not from poor
to rich or rich to poor, but directly on families with children.
Single people and married couples with no children face just about
the same tax rates as they did in 1960. But for a couple with two
children, average taxes have risen about 43 percent. A family with four
children has found their tax bill more than tripled.
The reason is simple. The personal exemption--the way the Tax Code
adjusts for family size--has been eroded by inflation and neglect.
Congress has allowed the exemption that once protected families with
children to fall in six decades to less than a third of its original
value.
The bipartisan National Commission on America's Urban Families
accurately stated the problem in its January 1993 report entitled
``Families First'':

As the dependent exemption has shrunk as a percentage of
income, families with children have incurred much larger tax
increases than other groups of Americans. . . . The
previously favorable Federal Tax Code treatment of families
with children has steadily deteriorated in recent decades.

The Progressive Policy Institute, in its 1990 manifesto: ``Putting
Children First: A Progressive Family Policy for the 1990's,'' points
out:

In 1948, there was a pro-family Government policy based on
a simple notion: The Government should not tax away that
portion of a family's income that is needed to raise
children. . . . The 1948 personal exemption was $600 and
median family income was $3187. This meant that a family of
four at median income paid a minuscule 0.3 percent of their
income in Federal income taxes.

Today, that family shells out one-quarter of its income to Uncle Sam.
If you add in State and local taxes, the tax burden on that family
grows to more than 38 percent of its income.
According to the Urban Institute, if the value of the personal
exemption for taxpayers with children had been adjusted for inflation
and real growth in income since 1948, it would have been $8,652 in
1993. Today, it stands at $2,350.

children are expensive to raise

For many families, this tax burden is a source of economic distress.
Children are more, not less, expensive to raise.
According to Family Economics Review, it currently costs between
$4,000 and $5,000 per year, per child, depending on the age of each
child.
Anybody who has ever bought a pair of Air Jordans at $125 a pair for
their teenager knows how expensive it is to raise kids. That is a
pricetag of about $80,000 by the time each child reaches 18--before
that child even leaves for college.
An increase in the personal exemption will help restore the
protection families once enjoyed in the Tax Code.
By putting money directly back into the hands of the American family
as the Gramm-Coats amendment would do, we can provide them the power to
make their own choices without Government interference. We can provide
parents with the ability to better care for themselves and their
children.

the time has come for family tax relief

Contrary to what some may believe, American families do not view
their earnings as a source of tax revenue, but as the just reward of
their own work.
Ronald Reagan once commented, ``For too long, Government has stood in
the way of people taking home more of what they earn, no matter how
hard they try. It is economics without a soul.''
As a candidate, President Clinton echoed a similar thought in
advocating family tax relief: ``We need to stop taxing away the money
parents need to raise a family, and restore the value of the children's
tax exemption.''--From ``A Plan for America's Future.''
Families should clearly be allowed to keep more of their hard-earned
tax dollars.
It is a matter of simple equity for millions of American families
that have been ordered by the Government to give until it hurts and
then give some more. A vote for the Gramm-Coats amendment is a vote to
restore equity to the Tax Code.
I am pleased to join my colleague, the Senator from Texas, in
offering this amendment. It is an issue that I have been working on,
and a number of us have been working on, for a long, long time. That is
to bring equity to working families who are trying to raise children
and meet the expenses of doing so.
This battle began way back in the early eighties as we began to talk
about how we could restore equity to families who had been shortchanged
under changes in the Tax Code that had been in place since 1948 when
the Congress first implemented the personal exemption. It has not kept
pace with inflation; it has not kept pace with the cost of raising
children and raising a family. We were fortunate enough to finally
double it in 1986, but we did not begin to restore it to full equity.
This amendment does not do that either, but it sure takes it a long
way towards restoration of equity.
It seems like over the past 20 years virtually every special interest
group in America has received a special tax break through the Tax Code,
except for the most special of special interests, and that is the
American family.
This particular amendment comes on the heels of a defeat in this body
of an attempt just yesterday to propose an alternative which would have
provided a $500 tax credit for every child in America. I regret that
that alternative was defeated. This is a second attempt to restore
equity to the American family.
I commend Senator Gramm for his efforts in this regard, and I am
pleased to work with him and join him in doing so.
What is important here is that this amendment is paid for. It is paid
for with real dollars, which offset the loss of revenue which would
ordinarily come to the Treasury if this exemption were not increased.
It is paid for in a way that helps fund the crime bill, which is
important to Americans. That reduces the deficit, which is important to
Americans and American families, and pays for the personal exemption.
It addresses the question that was raised yesterday as a special tax
break going to the rich, because under current law this exemption will
be phased out the higher your income level. It is not discriminatory
toward the poor because their opportunities under the earned income tax
credit and, depending on what their income level is, the combination of
EITC and the personal exemption will provide them relief.
What it goes to is at the heart of the question, and that is how do
we provide relief for the middle-income family. That is the family that
has seen an increasing percentage of their income go to fund the
Government, to fund Government programs.
That is the entity, and those are the people that Members from both
sides of the aisle during their campaigns have said we want to help.
President Clinton in his campaign was explicit in terms of trying to
reach out and help middle-income families, trying to give them some
relief, and he is on record as saying that.
It has not been provided by the administration. It has not been
provided in the Democrat budget. So this is an opportunity for Members
to state where they stand in providing real relief for American
families and particularly middle-income families.
Contrary to what many believe, American families do not view their
earnings as a source of tax revenue but as a just reward for their own
work. President Reagan once commented ``For too long Government has
stood in the way of people taking home more of what they earn, no
matter how hard they try. It is economics without a soul.''
As a candidate, President Clinton echoed a similar thought in
advocating family tax relief by saying: ``We need to stop taxing away
the money parents need to raise a family and restore the value of the
children's tax exemption.
Families should clearly be allowed to keep more of their hard earned
tax dollars.
It is a matter of simple equity for millions of American families
that have been ordered by the Government to give until it hurts and
then give some more. A vote for the Gramm-Coats amendment is a vote to
restore equity to the Tax Code.
It is fair, it is paid for, and it is time we delivered on our
promise to bring relief to American families.
Madam President, I yield back the remainder of whatever time I have.
The PRESIDING OFFICER. The Senator from Tennessee.

Unanimous-Consent Agreement

Mr. SASSER. Madam President, I ask unanimous consent that at 3 p.m.
the Senate proceed to consideration of the conference report to
accompany H.R. 3345, the Federal workforce restructuring bill; that
there be 10 minutes for debate, equally divided between Senators Glenn
and Gramm at that time; that at the conclusion or yielding back of
time, the Senate resume consideration of Senate Concurrent Resolution
63, and vote in accordance with the previous order on or in relation to
the three amendments that were stacked to begin at 3 p.m.; that upon
disposition of the Hutchison amendment, the Senate vote to invoke
cloture on the conference report of H.R. 3345; that if that vote is not
successful, the Senate then, without any intervening action or debate,
vote a second time to invoke cloture on the conference report to
accompany H.R. 3345, with the mandatory live quorums being waived.
I further ask unanimous consent that the second and succeeding votes
in this sequence be 10 minutes in duration; that the second vote would
be 10 minutes in duration; and that if cloture fails the Senate resume
consideration of Senate Concurrent Resolution 63.
The PRESIDING OFFICER. Is there objection?
Mr. DOMENICI. Mr. President, reserving the right to object, and I
will not object, I arrived from another engagement, as the chairman
knows.
Senator Craig has been waiting for a long time to speak 3 or 4
minutes on the Domenici amendment. How will that work into this? Will
he be unable to do that?
Mr. SASSER. I would not think so because we would be moving into this
at 3 o'clock. If this UC fails, of course we would move into the votes
previously ordered.
Mr. DOMENICI. Could we not give him 2 minutes right now or 5 minutes?
Mr. CRAIG. Maybe I can do it in 4.
Mr. DOMENICI. Could we do it later? Perhaps the Senator could insert
it right before we vote on my amendment. Perhaps he could have 5
minutes.
Mr. SASSER. Before moving on that, we should dispose of this
unanimous-consent request.
Mr. DOMENICI. Mr. President, reserving the right to object, and I
will not.
I have no objection.
The PRESIDING OFFICER. Is there objection to the unanimous-consent
request by the Senator from Tennessee?
Hearing none, it is so ordered.

Amendment No. 1567

Mr. SASSER. Madam President, I ask unanimous consent that the Senator
from Idaho be allowed to speak for 5 minutes on the Domenici amendment
at this time.
The PRESIDING OFFICER. Without objection, the Senator from Idaho is
recognized for 5 minutes to speak on the Domenici amendment.
Mr. CRAIG. Madam President, let me thank the chairman and the ranking
member for this consideration. I know that time has been a struggle
here the last 24 hours and the accommodation is truly appreciated.
I stand today in support of the Domenici amendment because clearly
this Congress and this Senate has to address deficit reduction across
the Federal budget. I say that because for so long we have relied on
what we argue is deficit reduction coming primarily out of
discretionary money while we have allowed entitlements to grow at an
astronomical rate in a way that clearly has set this budget out of
control. I do not care whether President Clinton comes to the Hill and
says, or any Member of this Senate says, that we have a Federal budget
that is in control. They simply cannot argue that. The facts are not
there.
We are dealing with very fragile projections in these kinds of
issues.
Let me give you an example of the very type of thing we are talking
about. CBO has re-estimated the President's budget to show deficits in
every year higher than OMB has projected.
Well, over the next 5 years, we have $113 billion more in deficits
projected out there than we had projected in the President's budget. In
less than 2 months--January through March --CBO's projections of its
own baseline deficits already have gone up by $46.8 billion for the
next 5 years. And yesterday morning, what did we hear? Orders for U.S.
factory durable goods dropped 2.5 percent in February, a leading
indicator of the health of the U.S. manufacturing economy. The Federal
Open Market Committee of the Federal Reserve said this week it would
raise Federal fund rates by a quarter of a percentage point, following
an identical increase on February 4.
Why cannot this Congress understand that long-term projections for
the budget it is dealing with and the deficit it is dealing with can be
so much gamesmanship?
I stood on this floor a month ago arguing for a balanced budget
amendment to the Constitution and every time, folks in opposition to it
would come to the floor of the Senate and say, ``Give us your plan. We
can't balance the budget without a plan.''
Well, let me tell you what this body is not doing. With all the
effort here today on this budget resolution, we are not talking of
balancing the budget. We are not talking of getting anywhere near that.
But with the Domenici amendment--even with the Grassley amendment,
although I would disagree more with it because of where it sends the
money--we are seeing some movement toward reducing deficits.
Let me give you some interesting figures. This is something that I
think few of us want to talk about today. This chart I had my staff
work with me on--and we have consulted CBO on it--shows two alternative
deficit projections, the yellow line being the projected Clinton
deficits. I have already told you that even as we were putting this
chart together, CBO said, ``Whoops, these figures are wrong. They are
off by maybe $100 billion.''
In the outyear of 1999, we are looking at a deficit somewhere between
$200 billion and $300 billion under the President's budget and at
today's interest rates.
What did I just say? Interest rates already are moving up. They
started up in February, they were up again yesterday, and it appears
that they can move further.
So in talking with CBO, I asked if they would help us extrapolate and
if they would work with us, starting with the same guaranteed deficit--
because, let me tell you, what is in the Clinton budget, although it is
a projection, you can bet it will not be any lower unless we can bring
about cuts as proposed in the Domenici-Nunn amendment.
But, in reality, if you take that guaranteed, fixed, minimum deficit,
by the time you get out to 1999, we are going to have a $6.5 trillion
debt, guaranteed, locked in. It is already planned. That is $2 trillion
added to our $4.5 trillion or $4.6 trillion existing debt.
Here is something. And this is a no-no, Mr. President. I took Jimmy
Carter's interest rates--because it is something that we still
remember; most of us were around during those days--and I applied them
to the Clinton debt. And guess what we got? We got, by the year 1999,
we follow this red line straight up to nearly a $500 billion annualized
deficit; that is, with the very budget that is here on the floor today
that we are debating, and just adjusting it for 1980 interest rates. No
gamesmanship. That is reality.
Now what does this spread mean in terms of the difference in deficits
and in the interest charged on the debt structure? By 1999, the spread,
the annual increase in spending, all of it deficit spending, on
additional interest payments alone would be 46 percent of all
discretionary moneys, 62 percent of the planned expenditure for Social
Security, 98 percent of defense spending, and 167 percent of Medicaid.
That is reality. That is how vulnerable we are to possible, even
overnight, changes in economic conditions.
That is why we have to support the deficit reduction in the package
presented across the board in the Federal budget with the Domenici
amendment. That is reality. Why fool ourselves any longer? These
planned, and potentially much larger, deficits are Bill Clinton's
burden. He ought to face it. He ought to work with us. So should the
majority. Guard against reasonable changes in interest rates and other
economic indicators. More and more debt is the reality of this budget.
We cannot escape it, so let us deal with it.
Mr. President, I rise in opposition to Senate Concurrent Resolution
63, the budget resolution for fiscal years 1995-99, as reported.

one more argument for the balanced budget amendment

Just a few weeks ago, when we debated Senate Joint Resolution 41, the
balanced budget amendment to the Constitution, opponents said that the
budget could be balanced without a constitutional amendment.
But the plan before us will not lead to a balanced budget--ever.
Opponents to the balanced budget amendment challenged supporters with
the mantra, ``Where's your plan?'' asking about the hard choices needed
to work toward a balanced budget.
Today, we see again that the opponents have no plan. This week's
budget resolution is one more argument--the 57th argument in 65 years--
for why we need to add the balanced budget amendment to the
Constitution.

deficits, debt in the stand-pat, status quo budget

Some of us are ready to make significant reductions in the deficit,
and supported the Domenici substitute this week. That alternative
included pro-family, progrowth policies, real deficit reduction, and
the middle-class tax cut the President promised when he was a
candidate. I am disappointed that a majority passed up the chance to
adopt that serious, thoughtful plan. Instead, we are left with Senate
Concurrent Resolution 63, the stand-pat, big-debt budget resolution.
The President and Senators on the other side of the aisle are
defending the status quo and touting ``the first 3 consecutive years of
deficit reduction since Harry Truman was President.''
However, even under the best case scenario, the deficit reduction
projected in this budget resolution is short term and temporary. Modest
deficit reductions will be followed in 7 out of 8 years by growing
deficits. Harry Truman would not have approved.

DEFICITS
[In billions of dollars]
------------------------------------------------------------------------
Fiscal year--
----------------------------------- 5-year
1995 1996 1997 1998 1999 totals
------------------------------------------------------------------------
Senate Concurrent Resolution
63......................... 174 173 186 181 192 906
CBO March baseline\1\....... 174 176 192 187 213 944
Clinton budget (CBO)........ 168 175 209 224 230 1,006
------------------------------------------------------------------------
\1\Excludes emergency earthquake supplemental.

The deficits planned in this budget resolution would have been even
worse, had it not been for the Budget Committee's adoption of the
bipartisan Exon-Grassley amendment, which trimmed an additional $43
billion in budget authority and $26 billion in outlays over 5 years. I
commend my colleagues for making at least some headway in committee.
Even with the Exon-Grassley amendment, however, the fiscal year 1999
deficit is only marginally lower than the $213 billion deficit in the
Congressional Budget Office's March baseline--less than 10 percent
lower. In fact, if tax revenues related to the administration's health
care plan weren't included, this budget resolution's deficits would be
larger than the baseline deficits.
More ominously, this budget does nothing to address the major policy
changes necessary to bring down deficits over the long term. CBO
currently projected a deficit of $386 billion for fiscal year 2004--a
projection that is already $21 billion above CBO's January baseline
projection.
We've heard much about the lean, mean Clinton budget. But let's look
at the levels of debt that the President, according to his own numbers,
promise to achieve:

PROJECTED GROSS FEDERAL DEBT, END OF EACH FISCAL YEAR
[Dollars in trillions]
------------------------------------------------------------------------
Fiscal year--
-----------------------------------------------
1994 1995 1996 1997 1998 1999
------------------------------------------------------------------------
Debt.................... 4.676 4.960 5.267 5.601 5.954 6.305
Change year/year........ .325 .284 .307 .334 .352 .352
------------------------------------------------------------------------

The Clinton Budget versus the Reagan Record

We've heard from the other side that much of this debt is not
President Clinton's fault, that he inherited it. They've said that the
Nation is still reeling from the debts run up during the 1980's. But
how does borrowing on President Reagan's watch compare with President
Clinton's?
President Clinton has submitted two budgets covering 6 fiscal years,
1994-99. President Reagan submitted eight budgets, for fiscal years
1982-89. Here's how their records compare:
Gross Federal debt added during the first 4 years for which each
submitted budgets:
Reagan fiscal year 1982-85: $823 billion, actual; Clinton, fiscal
year 1994-97: $1.250 trillion, budgeted.
Gross Federal debt added during the first and last 6 years for which
each submitted budgets:
Reagan first 6 fiscal year 1982-87: $1.351 trillion, actual; Reagan
last 6 fiscal year 1984-89: $1.496 trillion, actual; Clinton fiscal
year 1994-99: $1.954 trillion, budgeted.
Gross Federal debt added during all 8 years for which President
Reagan submitted a budget: fiscal year 1982-89: $1.873 trillion actual.
In other words, President Clinton has proposed to add more to the
national debt in 6 years than actually was added during President
Reagan's 8 years.
One other thing is important to keep in mind. For 6 of his 8 years,
President Reagan was hampered by gridlock. For just 2 years, in 1981-
82, there was enough bipartisan cooperation to enact and protect most
of his budget cuts and tax relief. An 8-year run of record-breaking
prosperity was the result.
But in 1982, the other party regained full control of the House and 6
long years of divided government followed. Partisan gridlock prevented
any deficit reduction consensus from forming. Six times, President
Reagan sent up budgets with significant spending cuts and deficit
reduction, only to see congressional Democrats declare them DOA: Dead
on arrival.
I've always believed, and always said, that both parties and both
branches bore responsibility for gridlock and deficits during the
1980's. But let's remember our history accurately: The $1.496 trillion
added to the debt in fiscal year 1984-89 were added because of
gridlock.
The 1992 Presidential election ended gridlock. The same party is
firmly in control of both ends of Pennsylvania Avenue now. This
President's budgets may have items or policies that are MIA--missing in
accounting--but they are not DOA.
So, if this President and this congressional Democratic leadership
wanted to slash the deficit and move toward balancing the budget, they
could do so. But when we look at this budget resolution, we see that
they have decided not to.
In fact, 6 years of gridlock between President Reagan and the
Democratic leadership produced 23 percent less debt than the 6-year
increase in debt budgeted as a result of cooperation between President
Clinton and the Democratic leadership.

projections are fragile

But even this storm cloud of debt has a darker, more ominous lining.
The nearly $2 trillion in new debt in the first 6 years of Clinton
budgeting is only a projection. These and other current budget
projections are based on, among other things, no economic downturn in
the foreseeable future and a continuation of some of the lowest
interest rates in 30 years.
In other words, these projections are based on assumptions about
future economic behavior that is dynamic and unpredictable. The
economy, and as a result, budget and deficit projections, can change a
little or a lot at any time.
For example:
CBO's re-estimate of the President's budget already shows deficits in
every year that are higher than Office of Management and Budget
projections, as follows:

----------------------------------------------------------------------------------------------------------------
Fiscal years--
--------------------------------------------- 5-year
1995 1996 1997 1998 1999
----------------------------------------------------------------------------------------------------------------
Differences............................................... 2.6 5.1 22.7 34.0 49.1 113.5
----------------------------------------------------------------------------------------------------------------

Another example:
In less than 2 months, January-March, CBO's projections of its own
baseline deficits already have gone up by $46.8 billion over 5 years;
Two additional examples appeared in this week's news:
Orders to U.S. factories for durable goods--a leading indicator of
the health of U.S. manufacturing--dropped 2.5 percent in February;
The Federal Open Market Committee of the Federal Reserve System said
Tuesday it would raise the Federal funds rate for short-term borrowing
by 0.25 percent, following an identical increase on February 4, for a
new rate of 3.5 percent.

CLINTON DEFICITS PLUS CARTER INTEREST RATES

Keeping in mind how subject to change economic and budget projections
are, we should heed a warning from recent history.
Currently, for the 1994-99 period, CBO and OMB have projected
interest rates ranging from 3.6 percent to 4.7 percent on 3-month
Treasury bills, and ranging from 5.8 percent to 6.2 percent on 10-year
Treasury notes.
But as recently as 1980, interest rates were above 11.5 percent on 3-
month T-bills and were 11.46 percent on 10-year T-notes.
I remember all too well the ruinous effects that 1980 interest rates
had on home buyers and business owners--and on Federal budget deficits.
Like a number of my colleagues and many persons outside this body, I am
struck by how optimistic our current interest rate projections really
are.
At it does every year, in its January Economic and Budget Outlook
volume, CBO estimated how a 1 percent increase in interest rates would
increase the deficit. We called a CBO, discussed their methodology,
applied some of their rules of thumb, and produced this graph, which I
ask unanimous consent to include in the Record.
This graph shows approximately what would happen to Bill Clinton's
deficits if interest rates returned to 1980 levels--Jimmy Carter
interest rates.
I will note that we produced our computations before the Budget
Committee marked up its resolution; therefore, the President's budget
was used as a point of reference. However, Senate Concurrent Resolution
63 essentially is the President's budget and any differences are
slight. Therefore, these alternative estimates, showing Clinton
deficits adjusted for 1980 interest rates, are reasonable
approximations and valuable for illustrative purposes.
The year-by-year result are as follows:

------------------------------------------------------------------------
Fiscal year--
----------------------------------- 5-year
1995 1996 1997 1998 1999 totals
------------------------------------------------------------------------
Clinton deficits (CBO re-
estimate).................. 168 175 209 224 230 1,006
Clinton deficits adjusted
for Carter interest rates.. 268 315 383 434 482 1,882
-------------------------------------------
Differnce (Increased
interest costs)............ 100 140 174 210 252 876
Clinton net interest (CBO re-
estimate).................. 213 229 240 251 262 1,195
-------------------------------------------
Total Clinton net interest.. 313 369 414 461 514 2071
------------------------------------------------------------------------

Let's try to put these alternative estimates into perspective. If
1980 interest rates returned this year and replaced currently projected
interest rates on Treasury securities, that one change alone would:
More than double the fiscal year 1999 deficit; almost double total
deficit spending over the next 5 years; and almost double net interest
spending in fiscal year 1999.
None of this new deficit spending would be for programs or services
or benefits; virtually all the increase would be in interest payments
on the national debt. We know what those interest payments buy:
Absolutely nothing. They are regressive transfers of wealth from
middle- and working-class taxpayers to large institutions and wealthy
foreigners.
How large would these increases in interest costs really be? By FY
1999, just the increase above baseline interest payments would be equal
to: 46 percent of all discretionary spending in the budget resolution;
62 percent of Social Security; 91 percent of all means-tested
entitlements; 95 percent of Medicare; 98 percent of defense spending in
the budget resolution; 167 percent of Medicaid; 280 percent of total
federal civilian and military retirement; and 525 percent of the
Education and Training function in the budget resolution.
My friends on the other side of the aisle would say, this is a worst-
case scenario of what might happen if President Clinton is as unlucky
as President Carter.
I would say, it is a cautionary note. This is what could happen if
Bill Clinton's policies prove to be as negative for the country's
economy as Jimmy Carter's, and if the rest of the world starts to clamp
down on Uncle Sam's unlimited line of credit.
These alternative estimates are just as illustration, but they show
what's possible--based on interest rates that we have experienced in
the past.
The analysis I have just outlined shows why: We should be passing a
budget resolution with more deficit reduction than Senate Concurrent
Resolution 63; current deficit projections may be more fragile and more
optimistic than we realize; and passing the President's stand-pat,
status quo budget is whistling in the dark.

real deficit reduction: who's on first

The foregoing analysis also shows why the Senate should have passed
the Domenici substitute, the 99-in-'99 plan. That plan would have
produced a deficit of $99 billion in fiscal year 1999, less than half
the baseline, Clinton, or committee levels; it would have reduced
deficits by $318 billion over 5 years, more than 8 times as much as
Senate Concurrent Resolution 63. The budget resolution assumes only $38
billion in deficit reduction, and $26 billion of that is because of the
Exon-Grassley amendment.
The Domenici budget was pro-family and pro-growth. Several of its
core provisions were based on S. 1576, introduced last year by Senators
Coats, Hutchison, Lott, and myself, and also known as the FIRST bill,
because it puts first things first. The name stands for the Family,
Investment, Retirement, Savings, and Tax Fairness Act.
I congratulate Senator Coats for bringing together the group of us
who wrote the FIRST bill, and commend Senator Domenici, our leader,
Senator Dole, and Budget Committee members on our side for including
much of the FIRST bill in the Domenici substitute.
A few weeks ago a minority of 37 Senators blocked the balanced budget
amendment to the Constitution from going to the House and then to the
States for ratification. Opponents kept asking supporters where our
plan was to balance the budget by fiscal year 2001. Several of us did,
and still do, have a plan: The FIRST bill. Just as our constitutional
amendment will not go away until we pass it, neither will our FIRST
bill.
As the Senate began considering the balanced budget amendment, the
Washington Times carried an op-ed by Senator Coats and this Senator. I
ask unanimous consent to include the text of that article in the
Record.
There being no objection, the article was ordered to be printed in
the Record, as follows:

[From the Washington Times, Feb. 22, 1994]

Balanced Budget Amendment, Yes; Tax Increase, No

(By Dan Coats and Larry Craig)

This week, the Senate will have before it a simple but
profound question: ``Should the Congress be required by the
Constitution to balance its budget?'' The issue is
straightforward and the American people have a vital interest
in the outcome.
While there are arguments on both sides, there can be no
arguments about the urgency of our circumstances. Every child
born in America now inherits $17,000 in public debt. This is
the destructive legacy of a Congress without courage. It is a
failure of political will. It is a betrayal of moral
commitments.
For decades the Congress has enjoyed the luxury of making
unlimited promises and financing them with unlimited debt.
Some have discovered the popularity of criticizing this debt,
secure in the knowledge that the budget process was rigged
politically to prevent real accountability. But now--with one
vote--Congress holds its credibility in its hands. In one
moment, we can prove our seriousness before a nation
suspicious of its government.
Amending the Constitution is admittedly serious business--
the most serious legislative act of which the Congress is
capable. The Constitution is the most basic social contract
between government and citizens. But the continued
accumulation of debt threatens the endurance of that
contract--an agreement not only with each other, but with our
children. A balanced budget amendment is a Constitution-class
solution for a Constitution-class crisis.
The spending habits of Congress are simply too entrenched.
Deficit spending has always made political sense. It allows
Congress to please people in the present by placing burdens
on the future. The next generation, significantly, has no
vote in the next election.
Critics of a balanced budget amendment have begun to issue
ominous warnings. As President Clinton's point man on
economic issues, Robert Rubin, recently said, ``We need to
save the country from this disaster.'' The possibility of
passage in the Senate has so alarmed Mr. Clinton that he
dispatched five Cabinet-level appointees to testify against
the amendment last week.
The White House claims that the only way to get a balanced
budget by the turn of the century is by dramatic tax
increases or Draconian spending cuts. Their analysts say the
amendment will lead to new taxes or to the slashing of many
programs, including defense, and that drastic tax hikes would
throw America into recession. They claim that balancing the
budget would cost every American $700 in the year 2000, while
ignoring the fact that the average American today pays more
than $1,000 in taxes just to make interest payments on the
nation's debt.
When it comes to raising taxes or gutting the Pentagon's
budget, we do not question that this president speaks with
authority. And we are glad the president acknowledges--
belatedly--that raising taxes is akin to recession roulette.
However, the truth is we don't have to raise taxes or
eliminate every discretionary spending program to balance the
books.
We have a plan that would balance the budget in eight
years. In addition, our plan provides and pays for a $500 tax
credit per child, a cut in the capital gains tax and several
other incentives for families to save and businesses to
invest.
As Ronald Reagan once commented, ``for too long, government
has stood in the way of people taking home more of what they
earn, no matter how hard they try. It is economics without a
soul.''
Our bill, which is called the Family, Investment,
Retirement, Savings and Tax Fairness Act (or ``FIRST'')
offers a blueprint for budget reform. It caps the growth of
federal spending at 2 percent (spending is currently growing
at an average of 4.5 percent a year). It creates a
commission, modeled after the base-closure commission, to
identify cuts needed to meet the cap.
If Congress fails to approve the commission's plan by a
certain date, then across-the-board cuts would take place to
meet the cap (Social Security would not be affected,
however).
Further, since American families are overtaxed, and because
high taxes rob families of the resources they need to care
for their children, the bill provides a $500 per child tax
credit. A $500 child tax credit will give a family of four
over $80 a month extra for groceries, school clothes for the
kids, or savings for education. It will empower families to
make more of their own choices and rely less on the
government. Fifty-one million children are eligible for this
credit. A $500 tax credit per child is real relief in tight
times.
Our bill also recognizes that the private sector, not
government, creates jobs. We must reduce the cost of capital
and encourage productive investment by reducing the tax on
growth. We will find new jobs in a growing economy, not in a
growing government. FIRST provides incentives for businesses
to create jobs, including a reduced capital gains tax rate, a
neutral cost recovery plan for investments and expanded IRAs.
So, yes, Mr. President, there is a plan--a plan that
reorders priorities to balance the budget and, at the same
time, allows families to keep more of their hard-earned
dollars and unleashes the productive power of the American
people. It is a plan that offers economics with a soul.

Mr. WARNER. Mr. President, I join with those who have spoken during
consideration of this budget resolution and the impact that cuts in
discretionary spending, as indicated in the Exon-Grassley provision,
would have on the defense budget and our national security. I support
the amendment of the Senator from New Mexico [Mr. Domenici], the
ranking Republican on the Budget Committee and a highly respected and
learned colleague on budgetary matters.
In the Armed Services Committee over the past several weeks, we have
heard from a number of our combatant commanders--the CINC's, who are
responsible for going to war in their assigned parts of the world if
war should come. We have also heard from the Secretaries of our
military services and the Chiefs of each service.
As I have listened to their testimony, it is clear that virtually
without exception, the leaders of our military establishment are uneasy
with the current level of funding for the Defense budget. While this
administration has put a high priority on readiness and moved
additional funds into some categories of readiness accounts, we are
beginning to see, I believe, some of the first, early indicators that
readiness problems are beginning to develop.
General Joulwan, commander of the U.S. European Command expressed his
concern about his command:

They are meeting the challenge, but we are stretching our
people and our resources to the limit. I am particularly
concerned about the impact of unplanned and unbudgeted
contingency operations on operating accounts, training and
the quality of life for our troops and their families.

Mr. President, virtually all of our combatant commanders and service
Chiefs expressed their concern about taking funds from the defense
budget to pay for the unplanned contingencies that continue to occur in
this world of regional instability and continuing crises. Invariably,
the military services end up taking funds for these contingencies out
of their hide.
In recent testimony before the Armed Services Committee, the
Commandant of the Marine Corps stated:

Our ability to maintain, in the longer term, readiness is
on the margin and, as I reported to you last year, is
trending downward.

General Mundy continued:

We are not able to maintain fully the programs that support
our people or that maintain our equipment and our facilities
commensurate with the hard use to which we are putting them.
We cannot continue these trends, or the corps that your
forebears in these halls once referred to as the force in
readiness will be anything but that.

Mr. President, the funding provided for modernization of our military
services has been reduced drastically. The Army's research,
development, and acquisition accounts have been reduced by 45 percent
since fiscal year 1989--from $20.5 billion in fiscal year 1989 to $11.3
billion in fiscal year 1995. The Chief of Naval Operations, Admiral
Kelso pointed out in his testimony before the Armed Services Committee:

We are asking to buy only 4 ships and 24 tactical aircraft
this year. Those numbers will not sustain the Navy at the
level our Nation will require in the future.

General McPeak noted that the Air Force will buy only 4 combat
aircraft this year.
Mr. President, we all read the same newspapers and watch the same
newscasts. Everyone here is aware of the peril that exists throughout
the world. As we speak, we are facing real danger from an unpredictable
and increasingly threatening North Korea. Are they developing nuclear
weapons and a means to deliver them? North Korea is refusing access to
the facts for the world to reach its own conclusions. The North Koreans
have a large, well-equipped army that is poised for action on the
demilitarized zone between North and South Korea. We have U.S. troops
serving along the DMZ now. If the North Koreans launch an attack,
American soldiers there will be immediately involved and we are
committed to reinforcing the South Korean peninsula with a force
similar in size to that we employed in Operation Desert Storm.
Our military services are involved now throughout the world in a
number of operations with great demands on our people, equipment, and
operating funds. We are continuing extensive air and sea operations in
Bosnia-Herzegovina to prevent air operations by belligerents in the
area and to enforce the arms embargo. We are now in the process of
completing our withdrawal from Somalia. We continue to provide support
to the Kurds in northern Iraq and are flying extensive air missions in
Operation Southern Watch to enforce the ``no-fly zone'' in southern
Iraq. The Chief of Staff of the Air Force, General McPeak, appearing
this month before our committee, stated, ``In Iraq, we have flown more
than twice as many sorties since Desert Storm as we flew in Desert
Storm.''
The United States may be called upon any day to provide large numbers
of our military to serve as peacekeepers in Bosnia. Congress must have
a debate on this issue before the commitment is agreed to. Such a
commitment would strain our personnel levels.
Mr. President, virtually every senior military officer who has
appeared before our committee this year has expressed concern about our
ability to execute two near-simultaneous major regional contingencies
as called for in the Bottom-Up Review. The state of our military
airlift and sealift has been identified as inadequate and a major
concern of our military leadership.
The last point I would make is that the President of the United
States, in his State of the Union Address this year, appealed to the
Congress to make no further cuts in the Defense budget. He understands,
as our Commander-in-Chief, how essential it is to have combat-ready
military forces with the finest equipment and support we can provide
them, prepared to respond to threats to our security and vital national
interests. I urge all my colleagues to support the Domenici amendment
to support our Commander-in-Chief, the men and women in our Armed
Forces and our national security.
Mr. KOHL. Mr. President, I rise in opposition to the Domenici
amendment. I do so for one simple reason. Senator Domenici's amendment
would eliminate a $26 billion spending cut.
Because of the Exon-Grassley amendment offered in Budget Committee,
the budget before us today cuts substantially more than recommended by
the President and cuts substantially more than a freeze would require.
Last year, we appropriated $550 billion in nonentitlement funds. If
this resolution passes, we will appropriate $540 billion--and stick at
that level for the next 5 years.
Senator Domenici's amendment would return appropriated spending in
the budget to approximately the level suggested by the President. The
Domenici amendment would add $26 billion to the amount the budget
allows the Appropriations Committee to spend.
I am surprised to find my friends on the other side of the aisle
working so hard to defend the spending proposed by a Democratic
President. I am surprised to see them working so hard to eliminate
billions of dollars of spending cuts.
The Domenici amendment is a clear demonstration that it is easier to
talk about cutting spending than it is to actually do it. It is said
that talk is cheap, but today talk is costing taxpayers billions of
dollars. If the Domenici amendment passes, we will have talked
ourselves out of one of the bravest spending cuts this body has ever
seen.
My colleagues know the statistics that argue for cutting spending:
deficits of almost $200 billion ``as far as the eye can see;''
Government debt of $4.6 trillion; interest payments on the Federal debt
that have become the Government's second largest expenditure.
And the economy will respond to spending cuts. In today's Washington
Post, Barry Bosworth, a renowned economist from the Brookings
Institution, is quoted as saying that the economy could absorb an
additional deficit reduction of $60 billion a year.
We are not going to regain control of our budget with words. We ought
to cut the deficit, and we ought to cut out empty speeches on the
deficit. If you are in favor of retaining $26 billion in real spending
cuts, speak with your vote, and join me in defeating the Domenici
amendment.
The PRESIDING OFFICER (Mr. Kohl). The managers' time has expired.
The Chair recognizes the Senator from Tennessee.
Mr. SASSER. Mr. President, I ask unanimous consent that the time
consumed by the Senator from Idaho be charged against the time under
the control of the minority on the resolution.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DOMENICI. I agree with that.
Mr. SASSER addressed the Chair.
The PRESIDING OFFICER. The Chair recognizes the Senator from
Tennessee.
Mr. SASSER. Mr. President, I ask unanimous consent that it be in
order at this point to ask for the yeas and nays on the Domenici
amendment No. 1567.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Mr. SASSER. I ask for the yeas and nays on the Domenici amendment No.
1567.
The PRESIDING OFFICER. Is there a sufficient second? There is a
sufficient second
The yeas and nays were ordered.

Order of Procedure

Mr. SASSER. Mr. President, for the information of Senators, the
Senate is about to conduct at least four back-to-back rollcall votes
beginning at 3:15. The first vote is going to be on or in relation to
the Domenici amendment on appropriations and Medicare and direct
spending cuts. The second vote will be on or in relation to the Mack
amendment proposing a sense of the Senate regarding a spending
commission. The third amendment will be on or in relation to the
Hutchison amendment cutting the appropriations caps and making the
assumption that savings will come out of the legislative branch.
Fourth, the Senate will vote on the motion to invoke cloture on the
buyout bill.
Now if that fourth vote fails to invoke cloture, then there will be
another cloture vote.
I disseminate this information, Mr. President, for the information of
colleagues who might be watching us on the television sets in their
offices.

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